<prompt> Human: I live in Texas and I work remotely for a company in Florida. My boss tells me that as I am only one of two employees that live out of state, the paperwork is too much and theyd rather have me as a contractor. My benefits will remain the same, but I will have to handle the IRA on my own. As they dont contribute to my IRA, that is not an issue. Hes acting like this will be a seamless transition but Im not entirely comfortable with the plan.Assistant: Legalities aside, unless he offering to pay you significantly more, around 30 more you are likely losing money on the deal. Here are the things you typically lose when you go 1099. Youll owe self employment tax of 15.3. This is both halves of your SS and Medicare taxes, usually you pay 7.65 and your employer pays the same. Now youll pay both halves, so really it is just a 7.65 increase in that tax. Do they pay for health insurance? As 1099 youll have to pay for your own. If you arent an employee, I doubt they can put you on the company plan. This can easily cost 1000 a month. Typically when someone is 1099, if you dont work you dont get paid. If you are salaried or hourly with paid time off and holidays, you get paid for a lot of days that you dont work. Typically there are about 10 paid holidays and PTO is all over the place. But if get 10 holidays and 3 weeks vacation, thats 31 days over a month of working days that you get paid for not working. Now if they are just putting you on a weekly rate and are going to pay you every week, then that negates that last point. So you need to be sure you are at least compensated for all of those, just to break even. Human: I thought it was 15 also, but my boss claims it is only 7.  <response>: Its only an additional 7.65, since youre already paying the first 7.65. Its 15.3 total split between employee and employer, but as a contractor youd pay all of it. 