Originally Posted by
USMCFLYR
I'm a contractor and was recently told by a mortgage lender that I had to have that job for TWO YEARS
before I could use my contractor's salary as a basis for getting a loan.
Does anyone else know of a work around here?
Like minitour - I also make quarterly tax payments and I get a -1099 from my employer.
USMCFLYR
This is true-- and a point I forgot!! We had to show 2 years of my wife working as an independent contractor for the house loan we were approved for this year when we moved. That and she had to show copies of the checks she had received over the last several months.
As a contract pilot, you will get a 1099. Remember *everything* you do for your contract flying is a write-off... dry cleaning, uniforms, sunglasses, computers, accounting software, etc.... I save *everything* for my accountant at the end of the year (small business owner as well, so it is very important to write-off as much as I can). Again, the SEP-IRA (self-employment IRA) is another fantastic way to lower your taxable income, and can save you thousands to the govt. We also make quarterly payments-- again, will save you hundreds in penalties at the end of the year-- just get with your accountant, or find one if you do not have one and explain your situation-- they have handled situations like this before, I can guarantee it!
There is a lot of good info on this thread. Contract flying can be very financially rewarding, but it is intimidating having to figure out all of the odds and ends that a company used to take care of for you. It also helps if you have a spouse with a "real" job that has health insurance!! Errrr wait... we all have health insurance now! right? ooorrr...what changed? Oh yeah, I pay more... nothing else.
Hope this helps some more...
-spike