getting set up as an independent contractor

I have been working for several months now for a rather large company doing product photography and photoshop work. I was hired basiclly as a temp but my supervisors have requested that I set my self up as an independent contractor. Since no longer working as a temp means a signifigant increase in my earning I am certain that this is what I want to do, but where do i start. Is it as simple as having a bank acount a tax id #, and keeping up with my own taxes? How should the paper work be handled, di I just produce a professional looking invoice for my time and costs. Do I have to have a Doing Business as id. If any one could give me some advice or point me in a direction that might help it would be greatly apriciated.

Thanks

In all honesty, you don't need anything but a bank account and Microsoft Office Do your work and send official invoices.Then... just claim your wages when you fill out your taxes. You won't be withholding your own taxes so be prepared to owe a lot of money in April

Let's let someone with a business degree answer first though...

Best Regards,
Patrick

If you're working at their direction using their equipment and their location for work, you're not a contractor no matter what the boss says. That's just a warning in case they are trying to get around the rules that bigger companies have been fined for trying.

You don't need a tax ID or anything. Your best bet is to set up a separate "business" checking account that's not really a business checking account (since the banks like to charge you more for that). Send invoices regularly, deposit the checks in the new account. Withdraw amounts on a regular basis to pay yourself for the work. Keep your books in something like Quicken or Quickbooks or Money just to make sure you're following where the money comes and goes. Then when the new year comes around, look for a good accountant to get you through tax season (and, yes, you'll owe a bunch, but the accountant can help with that as well).

You guys have been a real help, and I am hoping that some one can help me with one more thing. I have been asked to write up a contract that basically states that I will be employed at this company for atleast one year that states my pay rate and my basic tasks. This contract will insure that I receive 30-50 hours of work from them a week and should they back out of the contract I will be compensated. This contract will also be acompanied by Project proposals as the nature of my work changes through out the year. Can any one help me. I am just getting started and this is kinda scary. Thanks

donkylegs, it isn't tough, but keep in the back of your mind (not what the company says) what AM said about you not being an independent contractor incase they stiff you, don't give you warning of it terminating, etc. They want a full out employment contract. That is a bit odd for an independent contractor. If you need help setting up the contract, you can pm me, as this is what I do. Or take a look at Docstoc.com They have some stuff up there, but be careful, it isn't necessarily all the greatest things there, after all they are free.

Keep in mind things you can put in the contract or things you may purposely want to leave out, such as IP. Do you want access to or want to own the IP of the work you do? Do you want to give it to the company?

Regarding Taxes, make sure that you leave some money in the back to account for this, probably about 25% or so.

Cheers,
Jeff