PossibleDeviation

Just finished up my CFI a couple weeks ago and looking for my first CFI position. Is it the norm for CFIs to be considered 1099 contractors? I've applied to a mix of larger academy type settings and also FBO flight schools and am finding, so far at least, that the 1099 is a bit more prevalent.

I've looked into the details a bit with the 1099 status but can anyone with experience chime in as far as the downside of working as a CFI under this status?

I've read there is more freedom as far as listing deductions, but other than having to withhold and pay my own taxes, what is the downside?

**Looking at schools in California.

Thanks!

kingsnake2

In general, a 1099 employee is responsible for all tax liability including medicare and social security. An employee (W-9) has half of these taxes paid by the employer.

https://www.bankrate.com/finance/tax...ontractor.aspx

Btw, US Aviation is looking for CFIs if you're willing to move to Texas.

Pokeysrider

This should be thought as being a business decision, as the 1099 route is a business to business relationship. As a consulting business owner of nearly 30 years’ experience, I can tell you the strategies of being an independent contractor.
However, the question really should be why this route should be chosen, because as an independent contractor, you will have no protection under employment laws!
If you are going to do this, then you should treat it as a business. You will need to decide if you will incorporate, form an LLC, or be a sole proprietorship for the structure of the business. You will need an accountant, preferably a CPA who is also an enrolled agent with the IRS to keep your books and do your taxes. You’ll also need legal advice on which business structure to utilize. You’ll also need to SAVE 25-30% of your income for taxes and for your cost of doing business. Finally, there is the matter of insurance, both professionally and, personally. If you are an independent contractor, chances are good that you will not (although they will) have liability insurance coverage or protection.
In the end, an FBO or flight school that wishes to hire a new flight instructor as a contractor with wages being reported via W1099 is just seeking to shift their costs of doing business away from themselves and onto the contractor.
If they are paying $40-50 / hour, it may be worth it for you to do it. Otherwise, I would suggest staying away from this business to business relationship.
Feel free to message me and I can send you the step by step worksheet that we give to our new consultants to help sort their way through setting up their small business.
Gumby

Pokeysrider

Yes, they are looking for instructors and it is a good place to work, as there is a large, built in clientele of students waiting for instruction. All you have to do is show up, try your best and you’ll be up to ATP minimums as quickly or quicker than at any other school.
Gumby

rickair7777

If you're a time building CFI, 1099 is not going to be advantageous for you. Best case it will be an admin PITA.

All else being equal, take a W2 job.

A professional free lance CFI is probably going to want to do 1099.