Below are answers to frequently asked questions submitted by visitors to the Solo W-2™ web site.

We have organized the FAQs under headings that reflect The Five Dimensions of Solo W-2™ plus an additional heading for general questions about Other Services Offered by Solo W-2, Inc. These pages will direct you to explanations that should answer many, if not all, of your questions.

If you still have questions after reading all about Solo W-2™, you may Send an Online Message to:

• Schedule a Free Telephone Consultation or initiate an E-Mail Discussion to see if you and your solo career are a match for Solo W-2™.
  
  
• Ask a Question about how Solo W-2™ works.
  
  
• Submit a new FAQ topic for the Solo W-2™ FAQ page.
  
  
• Submit your solo career for inclusion in our growing list of Solo W-2™ careers.

At your request, a friendly member of our staff will get back to you by your preferred method and answer all of your questions. Submit an FAQ Topic

Solo W-2™ employment is geared to a wide range of solo careers for self-employed professionals, small business owners, freelancers and consultants who typically work in professional, technical and office settings. So, it is highly likely that Solo W-2, Inc. is a match for your occupation and industry.

We also employ, with certain conditions, individuals who work in so-called high-risk occupations such as commercial pilots, boat crews, truck drivers and construction workers. You should contact Solo W-2, Inc. if you have any questions regarding your profession and Solo W-2™ employment.

You can work anywhere in the United States as a Solo W-2™ employee and in many locations abroad, provided the client has a presence in the United States. Solo W-2, Inc. makes no restrictions on where you work, when you work or who you work for.

As a solo professional, you can generate income from as many different sources as you want and contribute the income to your division of Solo W-2, Inc. for payroll and benefits processing. You can also work on multiple projects for more than one client at a time under the terms of a contract between Solo W-2, Inc. and each client.

Unlike most traditional staffing vendors (e.g., temp agencies, contract employment agencies, recruiting firms and consulting firms) Solo W-2, Inc. places no restrictions on where you may work, or for whom you may work, at any time, either during or after your employment with Solo W-2, Inc. The Solo W-2, Inc. employment agreement contains no non-compete clause, no non-disclosure clause and no non-solicitation clause. We fully support the ability of solo professionals to work whenever, wherever and for whomever they choose.

Solo W-2, Inc. matches you with a dedicated executive assistant to handle the many time-consuming administrative tasks of running your division. Your personal Solo W-2™ division Administrator frees you to deliver quality business services to clients and customers who need your undivided attention.

Yes. The proprietary Solo W-2™ report generator prepares a detailed online Division Status Report that keeps you appraised of the status of your division's cash flow situation, including every penny received from every source, every penny paid out as a division expense, and the current balance in your division's account.

With every payroll, the proprietary Solo W-2™ report generator prepares a detailed online Division Cash Flow Report detailing every aspect of your division's activity, so that you always know the current status of your division's cash flow. Your Division Report is similar to the cash flow report or profit and loss statement that a CPA might prepare at the end of the year for a self-employed independent contractor.

Yes we do. Solo W-2, Inc. carries general liability (GL) and Errors & Omissions (E&O) insurance with an aggregate benefit of $5,000,000 to protect your Solo W-2, Inc. clients while you are working under the terms of a contract between Solo W-2, Inc. and your client. This level of coverage can save you thousands of dollars a year in private GL and E&O insurance premiums and makes you much more attractive as a consultant to potential client companies. There is no charge for this coverage.

Yes. As an employee of Solo W-2, Inc., you are covered by unemployment insurance and workers compensation while working on projects under the terms of a contract between Solo W-2, Inc. and your client. Your one-person division of Solo W-2, Inc. pays the state and federal unemployment insurance and workers compensation premiums as a payroll tax expense based on the Solo W-2, Inc. experience rating. Consequently, the cost to your division is typically lower than if you were to cover yourself as an independent contractor. Being covered for unemployment insurance and workers compensation as an employee of Solo W-2, Inc. makes you much more attractive as a consultant to potential client companies.

Think of Solo W-2™ employment as your other job. Many self-employed professionals work for a different employer in order to qualify for employee benefits. Solo W-2, Inc. is the other job you work at in order to qualify for employee benefits.

Your employment with Solo W-2, Inc. – your other job – is completely separate from any other employment or business venture that you may have. Moreover, Solo W-2, Inc. has absolutely no control over, relationship to or liability for work that you do outside of Solo W-2, Inc. You continue to work in your own business, under your own brand, on your own schedule, setting your own rates, serving your own customers.

Unlike a "regular job" than requires a specific commitment of time and effort, Solo W-2, Inc. makes no demands on your time. You alone determine how you generate the revenues that you run through your Solo W-2™ division.

As described in the previous FAQ, Solo W-2, Inc. will play no role in the operation of your own consulting business or with the clients of your own consulting business. We will, however, represent you as your employer with any client that you work for as a Solo W-2™ employee.

As your employer, Solo W-2, Inc. will provide:

• Contract review, contract negotiation and contract administration for the consulting services you perform for your Solo W-2™ client. These activities will be carried out with your full participation and approval.
  
  
• Automated, online, time and milestone reporting.
  
  
• Timely invoicing and assertive collection of receivables from your Solo W-2™ client.
  
  
• $5,000,000 in general liability protection for your Solo W-2™ client.
  
  
• Complete payrolling service, including payment of all applicable taxes, direct deposit of your tax-advantaged net wage and issuance of IRS Form W-2.
  
  
• The most comprehensive employee benefits package available to any independent professional anywhere in the USA.

You are probably confusing Solo W-2™ with a staffing vendor (i.e., headhunter, recruiting firm, temp agency, contract employment service, etc.). Solo W-2™ is not a staffing vendor and we do not find work for our employees. Think of us more as a do-it-yourself consulting firm. Appropriate names for what we do are: employer-of-record service, umbrella company and managed services company.

Solo W-2™ employees locate clients and customers on their own or they may use an outside service for this purpose. If you use an a staffing vendor to find contract work, Solo W-2, Inc. will generally subcontract through the staffing vendor for the consulting services that you perform. Be forewarned, however, you should expect a staffing vendor to take a large bite out of the billing rate as the "fee" for matching you with the client. Experienced professionals rarely, if ever, use a staffing vendor to find work.

There are many ways to find work. Here are a few:

• Create a LinkedIn.com profile and build a powerful professional network.
• Create a professional web site for your consulting business.
• Online newsgroups and forums for people with your skill set.
• Career pages on company web sites.
• Local and national newspapers, trade magazines.
• Old fashioned cold-calling. Call project managers. Submit your skills profile to potential clients.
• Job and career fairs, both online and in person.
• Networking and referrals by colleagues.
• Online job posting sites. Search for contract work and post your skills profile.
• Staffing vendors. Call and establish a relationship with a recruiter.

Solo W-2, Inc. employs qualified non-U.S. citizens holding valid work visas who want to work in the United States as contract professionals. Solo W-2, Inc. only sponsors work visas for highly skilled and highly compensated foreign workers who comply with the rigorous requirements detailed in the Solo W-2, Inc. Visa Sponsorship Policy.

If you owned a business with multiple employees, your business would pay the employer's share of payroll taxes for each employee, including yourself, and each employee would individually pay his or her own share of payroll taxes out of their gross wage.

When you are self-employed, your one-person business pays the employer's share of payroll taxes out of its revenue stream and you pay the employee's share of payroll taxes out of your tax-advantaged gross earnings (gross revenues minus expenses). The IRS calls this arrangement a "self-employment tax" but it is really just a scaled-down version of the taxes paid by an employer with multiple employees.

Your one-person Solo W-2™ division operates just like a one-person business. Your one-person division pays the employer's share of payroll taxes out of its revenue stream and you pay the employee's share of payroll taxes out of your tax-advantaged gross wage (division revenues minus expenses).

We designed Solo W-2™ to support the solo careers of financially successful independent professionals. For example, the average Solo W-2™ employee generates monthly revenues of more than $10,000, which is twice our minimum requirement of $5,000. We are very pleased that you want to join Solo W-2™, and we look forward to discussing your employment with Solo W-2, Inc. when your revenues do exceed our minimum requirement of $5,000 per month.

We sure do! Solo W-2™ provides complete contract administration services for consultants and other contract professionals, including contract review and negotiation, online time and expense reporting, timely invoicing of your Solo W-2™ clients and assertive collection of your division's accounts receivable.

Your Division Administrator works with you to carefully review and evaluate all new contracts with your Solo W-2™ clients, ensuring that you always work under the terms of a professionally negotiated contract that protects your interests.

Yes. We have an easy-to-use online template in the Solo W-2™ secure Members Site that lets you create separate online time sheets for each separate client and project. Time sheets are automatically sent to the client's project manager for online approval.

Yes. We invoice your Solo W-2, Inc. client within one business day (usually within minutes) of receiving an approved time sheet. With a single click, the Solo W-2, Inc. proprietary report generating system automatically generates an invoice from your approved time sheet. After reviewing the invoice and making any necessary adjustments, your Division Administrator sends it to the client for payment. Our reporting system monitors the progress of your invoice and automatically alerts your Division Administrator if positive action is required to expedite payment.

We always negotiate the fastest possible payment cycle. Our accounts receivable float typically varies between 10 to 30 days.

Your Division Administrator simply adds your client-authorized out-of-pocket expenses as additional line items on the invoice. Solo W-2, Inc. does not charge a service fee on collected expenses, so you receive every penny of reimbursed expenses with absolutely no deductions.

Solo W-2, Inc. is not an insurance broker and does not sell insurance to the general public. Rather, Solo W-2, Inc. is an employer that purchases benefits, including group health insurance, for its employees. In the Solo W-2™ business model, each employee manages his or her own one-person division of Solo W-2, Inc. and each employee is personally responsible for generating the revenues that fund his or her Solo W-2™ division.

We post the cost of Solo W-2™ group health insurance premiums on the Group Medical and Dental Insurance page of our web site. Solo W-2™ employees receive an exceptionally high benefit for the premium cost. Here are some important facts to consider when comparing the cost of Solo W-2™ group insurance with the cost of individually underwritten policies.

• Solo W-2™ employees can choose from HMO, PPO and Major Medical HSA plans.
  
  
• Download the plan description for each plan and make sure that you are comparing equivalent levels of coverage.
  
  
• Be aware that many insurance brokers and insurance web sites initially will quote you a price based on the assumption of excellent health. Later, the carrier will increase the premium or deny coverage entirely when it discovers pre-existing medical conditions. Insurance provided to Solo W-2™ employees is guarantee issue at the quoted price.
  
  
• Insurance coverage is available throughout the U.S. and in many foreign countries.
  
  
• The Solo W-2™ PPO plan has a low $500 deductible (for individuals) and pays 90% of most claims. This means that the out-of-pocket co-pay is one-half of the co-pay for a typical 80/20 plan. The plan pays 100% after an annual maximum of only $3000 (for individuals). Unlike many cheaper plans, the Solo W-2™ PPO plan has no lifetime maximum benefit..
  
  
• The Solo W-2™ major medical HSA plan co-pay is typically 30% but, after the annual out-of-pocket maximum, the plan pays 100%. The plan has no lifetime maximum for in-network services.

Yes. Employees who terminate from Solo W-2, Inc. may continue their health insurance coverage under COBRA. The premium under COBRA will be 2% above the premium for employees with equivalent coverage.

Yes, we do. Solo W-2, Inc. provides Long Term Disability Income Protection for every full-time employee with no medical underwriting. You cannot be denied individual coverage for any reason. Guarantee issue is possible because the plan has 100% participation. The benefit payout is 60% of gross wage up to $10,000 per month, and payments begin only 90 days following the onset of a qualifying disability. Because the payout is tax-free you get to keep the entire payout instead of having to give up nearly one-half as taxes, which is the case with traditional employer-paid plans.

Long Term Disability Income Protection Insurance is perhaps the most important insurance coverage an independent professional can have, yet it can be virtually impossible to purchase “on the street” at reasonable rates, if at all. The Solo W-2, Inc. Long Term Disability plan is a tremendously valuable benefit to protect your income in the event you become disabled and cannot work at your own occupation.

Yes, we do. As a Solo W-2, Inc. employee, you can literally turbo charge your retirement savings with the Solo W-2, Inc. Roth 401(k) Retirement Savings Plan. For example, The incredibly powerful Solo W-2, Inc. Roth 401(k) plan with 200% employer match (funded by the revenues that you generate) lets you load your tax-deferred retirement account up to the absolute IRS limits much faster and with lower gross revenues than a typical self-employed person can. Read about the amazing Solo W-2, Inc. $81,000 advantage in the Solo W-2 Blog.

Key features of the Solo W-2, Inc. Roth 401(k) Retirement Savings Plan include:

• Automatic enrollment.
  
  
• No waiting period.
  
  
• Immediate vesting.
  
  
• In 2008, you may contribute up to the IRS maximum of $46,000 ($51,000 if age 50+).
  
  
• Total contributions may equal 100% of your YTD gross wage up to the IRS maximum.
  
  
• Roth 401(k) option allows tax-free retirement distributions.

Just how powerful is the Solo W-2, Inc. 401(k) Roth Retirement Savings Plan? A self-employed person must earn around $162,500 after expenses in order to contribute the maximum allowable amount for 2009 into an individual 401(k) plan. A Solo W-2, Inc. employee requires only about $81,500 in revenues after expenses in order to put the same $49,000 into his or her Solo W-2, Inc. 401(k) retirement account. That is a huge advantage!

As an added bonus, every Solo W-2, Inc. employee receives free retirement plan counseling and general financial advice from our dedicated Chartered Financial Consultant (ChFC).

Every Solo W-2™ employee enrolls automatically in the Solo W-2, Inc. Roth 401(k) retirement savings plan when they join the company. It is not possible to opt out. The mandatory (safe harbor) contribution by your division is 3% of gross wage. The IRS requires 100% participation at the minimum contribution level of 3% in order that every Solo W-2™ employee may contribute the maximum amount to their 401(k) retirement savings account.

Investment advisors unanimously agree that employees should contribute as much as possible to a tax-advantaged retirement savings account. The unique Solo W-2™ business model lets highly compensated Solo W-2™ employees contribute more tax-deferred dollars to their 401(k) account at a faster rate and with lower gross revenues than most self-employed persons are able to do.

The very generous Solo W-2, Inc. accountable plan for tax-exempt reimbursed expenses dramatically increases your net pay and significantly reduces the risk of an IRS tax audit. You receive your tax-free reimbursements immediately, with minimum effort. You don't have to wait until the end of the year to realize the tax-advantages of your independent lifestyle.

The upper limit for all reimbursed expenses, not counting per diem payments, is 50% of year-to-date gross wages. The upper limit for GSA per diem payments is 100% of year-to-date gross wages. The upper limit for out-of-pocket medical expenses is $10,000 per year, not counting private or group medical insurance premiums, and is included within the 50% upper limit for all reimbursed expenses.

It's easy to claim your tax-free reimbursements for out-of-pocket expenses. Simply go to the Solo W-2™ secure Members Site and enter your expenses in the convenient, automated online form.

We sure do. Solo W-2™ employees qualify for the maximum federally authorized per diem rates while traveling and working out-of-town. Solo W-2™ employees also qualify for an auto allowance for the anticipated monthly cost of leasing and maintaining an automobile while on extended out-of-town assignments.

Tax-free per diem allowance is only available to company employees, and is not available to self-employed independent contractors, who must itemize every expense while traveling and working out of town. Simplified expense reporting for work-related travel and out-of-town living expenses is one more way that Solo W-2™ gives independent professionals great tax advantages and higher net earnings.

Yes we do. The Solo W-2™ leaseback program is a tax-free solution that converts expensive capital purchases for computer equipment, test equipment, software and other tools of the trade into tax-exempt rental payments. The Solo W-2™ leaseback program is yet another way that Solo W-2™ delivers the tax advantages of self-employment within the framework of corporate employment.

Solo W-2™ operates in the background, completely separate from any other employment or business venture that you may have. Because your Solo W-2™ division reimburses qualifying division expenses with tax-free dollars, you do not report your Solo W-2™ reimbursed expenses on your personal tax return or separate business tax return.

If you operate a sole proprietorship, partnership, limited liability company or corporation in addition to your employment as a Solo W-2™ employee, you should report qualifying expenses for that business on the appropriate IRS form. Whether or not you file Schedule C depends upon the type of business entity. The IRS forms used to report business income and expenses for different types of business entities are listed below.

• Sole Proprietor: Form 1040 Schedule C
• Statutory employee: Form 1040 Schedule C
• Minister: Form 1040 Schedule C
• Farmer: Form 1040 Schedule F
• Partnership: Form 1065
• Husband-wife business (partnership status): Form 1065
• Limited Liability Company (sole proprietorship status): Form 1040 Schedule C
• Limited Liability Company (partnership status): Form 1165
• Limited Liability Company (corporation status): Form 1120
• C Corporation: Form 1120
• S Corporation: Form 1120S
• Income from non-business activity: Form 1040 Line 21

The very low cost, direct savings, tax-advantaged earnings and convenience of Solo W-2™ preserve and enhance your earning power as an independent professional. And, when you consider all that we do to support your solo career, the cost is very low, indeed. You might even say that Solo W-2™ pays for itself. Read about the Low, Low Cost of Solo W-2™.

Although the Solo W-2™ service fee is already very low – much lower, in fact, than the profits taken by traditional staffing vendors – Solo W-2, Inc. also has a Referral Rewards program that can easily make the cost of our service free or even better than free.

Surely, you know one or more independent professionals who need Solo W-2™ as much as you do. Refer a friend or colleague today. You will begin receiving 1% of the revenues your referrals generate when you join Solo W-2™.

Solo W-2, Inc. pays Referral Rewards to active employees in good standing. If you are not yet a Solo W-2™ employee, and a new employee names you as the reason they joined, you will qualify for your Referral Rewards as soon as you become a Solo W-2™ employee.

Referral Rewards stop when you terminate your employment with Solo W-2, Inc. and begin anew if later you rejoin Solo W-2, Inc.

Traditional staffing vendors operate with a high level of greed and operational inefficiency, which is aggravated by a culture of secrecy and a code of silence relating to pay rates and profit margins. For example, can you think of another industry where the employer systematically prohibits its own employees from knowing the billing rate it charges for the employee's direct services to the customer?

In sharp contrast to the traditional staffing vendor business model, the Solo W-2, Inc. business model is completely open to scrutiny. Our proprietary systems are automated and efficient, and every employee receives a complete accounting of every penny generated by the employee's efforts and every penny spent to fund the employee's benefits and payroll.

Solo W-2, Inc. does not employ expensive salespeople and does not purchase expensive advertising to market its employees' consulting services to prospective clients. Our fees are low because our overhead is low and because we are frugal. Our reputation for low cost, fair treatment, superior employee benefits and full disclosure attracts employees and clients alike who appreciate the way we do business.

Solo W-2, Inc. has over ten year’s experience providing back-office logistics support, executive-level employee benefits and contracts administration for independent professionals, including self-employed persons, small business owners, freelancers and consultants. Solo W-2, Inc. also provides contingent workforce compliance, co-employment risk mitigation and contractor payment services for corporate employers, progressive staffing vendors and government agencies.

Founded in 1997 as Jerzy, Inc., DBA the Professional Association of Contract Employees (P.A.C.E.), the company processed its first payroll in 1998 and has grown steadily to a point where Solo W-2, Inc. is now recognized as a leader and valuable nationwide provider of premium support services for the contingent workforce. In 2007, the company changed its name to Solo W-2, Inc. and re-branded its core services to reflect more accurately the company’s focus on the solo workforce.

Branded services include:

• Solo W-2™ employer-of-record service, contract administration, W-2 payroll and employee benefits for self-employed persons, small business owners, freelancers and consultants.
  
  
• Solo 1099™ agent-of-record service, contract administration, 1099 payroll and IC pass-through billing for fully compliant independent contractors.
  
  
• Solo IC Compliance™ compliance testing, certification of independent contractors, mitigation of co-employment risks, cost containment and contractor payment processing for organizations that use contingent workers.
  
  
• Solo BackOffice™back-office support, payroll and benefits for small businesses, start-ups and progressive staffing vendors.

The client probably wants you to subcontract through a third-party vendor because it is concerned about co-employment risks to the company if you look too much like one of the company's employees or if you later fail to pay your taxes and the IRS goes after the company instead of you for back taxes, penalties and interest.

As a service to your client, Solo W-2, Inc. will test your consulting business for compliance with generally accepted criteria for independent contractor status. If your business complies, we will certify you as a Solo 1099™ Certified IC™ Independent Contractor. We will then subcontract your business through Solo W-2, Inc. to the client. Solo 1099™ is our agent-of-record service for fully compliant independent contractors.

If your consulting service does not comply with generally accepted criteria for independent contractor status, we will convert you to W-2 employment status through our Solo W-2™ employer-of-record service.

Yes. Solo W-2, Inc. offers convenient and economical contractor payment processing for independent professionals engaged by businesses and government agencies on domestic and international projects. Our contractor payment processing reduces the cost of engaging contingent workers by 20-30%, or more, compared with traditional staffing vendors.

Solo W-2, Inc. does not set the billing rate for the consultants that it represents. There is no charge for independent contractor compliance testing and there is no charge to convert a non-compliant independent contractor to fully benefited Solo W-2™ employment status.

Solo W-2, Inc. does charge the consultant’s account a nominal administrative fee equal to 6% of collected revenues. Your organization may opt to subsidize part of, or all of, the administrative fee as a mark-up on billings, but that is between you and the consultant.

We sure can help you. Solo W-2™ helps small business owners and start-ups recruit and retain quality talent. Our benefits-rich employer-of-record service helps you attract exceptional talent that might otherwise go to the competition. And the superb Solo W-2™ benefits package helps you keep experienced team members that might otherwise jump ship for the employee benefits offered by a larger competitor.

Moreover, you gain the flexibility you need to easily and efficiently initiate, restructure and terminate projects by engaging a benefits-rich contracted workforce of professional consultants. You simply replace annual reviews with periodic contract extensions.

The economies of scale generated by Solo W-2™ give you and your key team members access to the superior executive benefits found in large professional firms – all without the hassles and high costs of in-house benefits administration.

No. Solo W-2, Inc. is not a professional employer organization (PEO). Solo W-2, Inc. is a consulting company that employs independent professionals who use their talents to generate income from multiple sources.

A PEO is a specific type of staffing vendor that signs a blanket contract with an employer to hire and jointly employ a block of workers for the client. Essentially, the client outsources the entire human resources function for a defined block of employees to the PEO. The table below illustrates some of the key differences between Solo W-2, Inc. and a PEO.