Change from 1099 to W2 - Estimated taxes

terryntaylor · #1 (**permalink**) 02-09-2009, 12:02 AM

Hi -

I worked all of 2008 as a 1099 contractor and then converted to a W2 employee in January. My assumption is that now federal taxes are being deducted from my bi-monthly pay check I'm not going to be on the hook for quarterly estimated taxes... hopefully!

TaxGuru · #2 (**permalink**) 02-09-2009, 01:57 PM

That is correct! But, if you withheld less taxes than what you owed in 2008, you may be subject to underpayment penalties and interest. Please check with your Tax Adviser that adequate amounts are withheld on your Federal and State income taxes so that you would avoid any possible underpayment penalties.