Do You Know How Much to Set Aside? Do you???

Whatever my concerns were before about doing work for a contracting company, let me tell you now that they are quickly vanishing.

I hope to develop a great partnership with these people. Sure, it could have something to do with the fact that they paid me for TWO jobs this week. One of the jobs wasn't supposed to pay out until next week, but they went ahead and cut me one...nice, big, fat check.



My "mentor"/resident expert/boyfriend was pleased, but then started asking me if I knew how much money to set aside to pay for taxes and for liability premiums.

I already file a monthly report and payment for worker's comp coverage, so I know I'm current with that.

When I set up liability insurance the agent had me "guesstimate" how much I'd pay out in salary my first year. (I did this while on a ski trip over Spring Break with my sweety and his kiddos. The photo above is from that excursion.) Based on my "guesstimate" we came up with a premium which I paid in two installments.

but, because my "mentor"/resident expert/boyfriend was so, um...how shall I say this..."concerned" over the weekend. I called my agent this morning to make sure I didn't have to pay anything.

She said that based on what I've paid out in salary so far, I would not be audited, nor would I owe anything. They would simply renew my policy at the beginning of the year and send me a bill. Personally, I think I WAY over-guesstimated my payroll and they might owe me! I'll bet it doesn't work that way. Maybe I should DEMAND an audit. lol

Oh...and I called my accountant to find out how much I should be setting aside for taxes. He told me to tally up my net profits and he'd come up with a percentage for me.

I don't take any money out of my business account. Well, let me amend, I paid myself once, but the rest of it, I leave in there just because...well, it's a new company and I still have start up costs looming. For instance, I'm meeting with a graphic designer this week to see if she can come up with a logo for me. I need to get a logo ASAP. Once I have that in hand, I'll be ordering forms, stationary and getting a work van all gussied up. (hopefully...first I have to GET a work van)

For the record...(in case any of you are going to audit me)...I have completed four jobs. Alas, my latest bid to the contracting company has not been snatched up. It was a large job that would require careful work as the floors are very old, which means the wood is quite thin. My "mentor"/resident expert/boyfriend saw splintering and told me to charge more per square foot because it would be trickier work.

I supposed the contractor found someone cheaper and that's okay, I guess. But I do know you get what you pay for and if they went cheap, they may just cause more problems for themselves.....or....maybe that's just my wishful thinking. LOL J/K...

Sort of.