Billing for tutoring?

I paid my son’s tutor $45/hour, and I paid her each time we went when it was just once a week. (At the beginning, when it was more often, I paid once a week.) I would recommend figuring your taxes in your stated rate, it will be less confusing for those paying the bill. Do you have to pay sales tax in addition to self employment taxes? You need to figure the cost of all the taxes you need to pay when figuring out your rates and adjust the rates so that you end up making more than a few dollars an hour. You also need to keep really good records…get a ledger and maintain it regularly.

Kay

I too paid a tutor every time she came. We don’t pay sales tax but I agree it is simpler to just include it in your rate.

Beth

When I tutored this summer, they paid me each time.
You probably do need to charge more if you are going to do it as a business and pay taxes.

I pay the piano teacher up front at the beginning of the month for the lessons that month. I would collect the money either in advance or at each session, not after.

Janis

I’m pretty flexible. Most of my clients want to pay weekly, but I also have some who pay monthly. Those who pay monthly generally pay in advance, although this may slip a bit from time to time. As you quickly develop a relationship with the parents of the children you tutor, you will find that the parents let you know what they are comfortable with. I’ve only been stiffed once over the past two years of tutoring.

FYI, I use Quicken Home & Business, which really does help me keep track of my billing and business expenditures, and also makes it easy to provide a report to parents who wish to write off my expenses. I know many tutors who work under the table, but am much more comfortable, personally, declaring my tutoring income each year, which allows parents (particularly those with children in private schools) to deduct a portion the money they pay to me each year.

BTW, Quicken is NOT very user-friendly, so I’m not recomending it by ANY means, but it can be made to do the job for a relatively cheap price.

I just reread my previous post….I did not mean to insult anyone who does not declare their income. I tutor year-round, and have 8-10 students on my caseload at a time, some of whom receive up to 5 hours of tutoring/week in the summer. As a part-time tutor/full-time teacher, I’d probably do things differently.

Oh, we understand, keb. There definitely is a difference between someone who tutors several students year round as compared with 1 or 2 students a year.

Janis

>I paid my son’s tutor $45/hour, and I paid her each time we went when it was just once a week. (At the beginning, when it was more often, I paid once a week.) I would recommend figuring your taxes in your stated rate, >it will be less confusing for those paying the bill.

Well I would certainly have to find the exact rate but what I meant was *saying* it was $25 plus tax (which is ?) and then I would figure out exactly what that is. I think the tax rate is about 5.2% or something. I didn’t mean that I would make them figure out the tax!

>Do you have to pay sales tax in addition to self employment taxes?

Yes. There is a sales tax on services in NM.
I don’t know that there is a self-employment tax (not that I have heard of). You pay taxes on what you earn

>You need to figure the cost of all the taxes you need to pay when figuring out your rates and adjust the rates so that you end up making more than a few dollars an hour.

I have thought that this first person may be getting a really good deal. :-)
I may up my rate just for all the various and sundries. Still I am in a poor state vs something like NY. So I have to keep that in mind.

> You also need to keep really good records…get a ledger and maintain it regularly.

I have Quicken but it is not something I have, er, played around with. I had a real nifty “invoice creator” when I did consulting once, but I believe I need something a bit more heavy duty and inclusive.

>Kay

—des

I had a tutor come 2x a week and paid at the second visit each time he didn’t have to charge sales tax.

I think it is important to set goals and discuss progress with parents at least on a monthly basis. Communicating with the regular teacher is very good too.

Check your area for what a reasonable fee would be I don’t think once a week is enough to help. I tried that way too, but if the fee is too high parents can’t afford more than once a week.

If your goal is to remediate the child than your reputation will get you more clients.

Dear DES,
If you plan on declaring your income (which if you’re worried about sales tax, I assume you are), you also will need to check on other taxes. In particular, when my husband was a self employed contractor, he had to pay the full ~14% social security (as opposed to the ~7% you pay when your employer is picking up half). Depending on the city you live in, there may be other employment taxes you will need to pay. It may be worth your time to consult with a local tax accountant to find out all the papers you need to file. For one thing, when you’re self employed, at least as an engineering contractor, you have to fill out quarterly estimated tax forms and make payments quarterly to the IRS, and depending on the state you live in, you may have to make payments to your state revenue service. This, of course, is if your income level from your home run business is sufficiently high. It really was a major pain filling out all the required forms when my husband was self employed, and an accountant really helps.

Kay

Marion: In my state there is a sales tax on services. Not all states have this. Either your state does not or the tutor included in. My bet is that it did not as to my knowledge this is pretty wierd.

Kay: I know that you have to pay other taxes. I have an accountant to use and am planning to go for advise as to exactly what these things are. He gave me a little free info earlier. I will also go to him before I really start making money (as opposed to maybe a few sessions) so he can tell me what to watch out for etc.

Thanks you give good advice here. I was pretty surprised the other day, after I posted and there were two pages of very good suggestions. Not surprised really knowing the group.

—des

I paid our son’s tutor each week when we arrived. As a parent, I’d rather write a check for $XX than $xx.xx. Also, I sometimes paid cash if I drove off without my checkbook, and I wouldn’t want to fuss with $xx.xx if I was paying with cash.

You have a point about the $XX vs the $XX.XX perhaps I could make the tutoring fee an odd no. so that the price with tax ends up as an even no.

—des

Course I shoulda said a WHOLE number. :-)

—des