Transition from W2 to Contractor - what do I need to know?

Post date: 2022-09-28 04:41:34

I am a software engineer based in the US. After decades as a W2 employee, I want to become a contract worker. Please tell me what I need to know so that I cover all the necessary bases. Also I'm hoping you can give me advice on how not to get ripped off.

I've never done any contract work before, so please assume I'm starting from a position of knowing nothing. Some of the questions I have :

- Should I incorporate as a Sole Proprietorship, LLC, or S-Corp? (yes, I have read this question)
- Should I consider using an Employer of Record service instead of incorporating? A friend recommends iprofessional.com — Does anybody know anything about them? Do you know of any competitors? Most of the ones I've found are geared towards companies wanting to hire a remote international workforce.
- A bunch of online companies promise to set up your LLC or S-corp for you. Are any of them worth it?
- What kinds of insurance should I buy to protect myself from possible lawsuits?
- What should I know about taxes?
- What should I know about contracts? Should I hire a lawyer to look over any contract that I might want to take?
- What do contracts usually look like for contract workers in the software industry? Do they usually pay an hourly rate?
- I've heard sometimes clients try to get away without paying. What can I do to protect myself here? And if someone does try to make off without paying, what recourse do I have (realistically speaking)?
- What's the best way to find gigs? Are there any good websites for this? What about the recruiters that reach out to me over linkedin — are they good for finding contract work?
- What are the best online communities for software contractors? Basically, places where I can get advice, ask questions, learn what to watch out for, etc.
- If you've worked as a contractor, what are some other things you wish you knew before becoming a contractor?
- Any other knowledge or advice you wish to impart?

Also, if you have any websites or articles that could help me, please do feel free to post links to them. Thank you!

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