A cool 1099 perk - Almost free first class flights and hotels
At my last company, I was bored at work quite a bit so I spent a lot of time researching the world of " travel hacking ," which is basically the idea that you can travel at highly discounted rates, or even for free, if you sign up for the right credit cards and get the right points.
Over the last seven years or so I've probably signed up for 50 credit cards so I could get the sign up bonus.
The terms of the bonus are usually something like "Sign up, spend $5,000 in three months, get 60,000 airline miles."
Two to three credit card sign up bonuses is typically enough to get you a round-trip business class flight overseas. I used mine to take some cool trips that even allowed me to take a shower on the plane and stay in luxury hotels for free!
The annoying part about the hobby though was managing the "minimum spend." If you sign up for lots of cards you need to switch over your daily spending to the new card so you can get the sign up bonus within the three to six month window.
This problem was basically solved when I became a 1099. As a 1099, you have to pay your own estimated taxes every quarter and the nice part is you can do it with a credit card for a 2% fee .
My quarterly payments are usually between $10,000 and $15,000 so each quarter, if I wanted to, I could sign up for 2-3 cards and hit the minimum spend for the sign up bonuses in one shot.
Yes, the 2% fee adds up to hundreds of dollars, but it is worth it for me because
a) It removes the hassle of managing the credit card spend for an extended period of time and
b) The value of sign up bonuses are usually worth a minimum of $500 and in some cases, thousands of dollars depending on how you use them.
c) The 2% fee is actually more like 1.75% because it is a business expense that is tax deductible
d) You'll still earn base points (minimum 1 point per dollar spent) in addition to the sign up bonus and each point is worth about 1 cent a minimum so in the end the net fee is really more like 1%
The other nice part about becoming a 1099 is that you can sign up for business credit cards legitimately. I say "legitimately" because you can usually get them even without a "real" business.
But, some people are uncomfortable with that so if that was a barrier before, having a real business opens up a ton of credit card sign up bonus options for you.
I wouldn't become a 1099 just to make your travel hacking life easier, but it is a nice "bonus," especially when you have the flexibility to take extended vacations.