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1099 tax question


JonesinIndiana
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Hi, I took a part time job, (one of 4 pt jobs I now have) :D and I have a question about taxes.

 

I have worked 1 day and they cut me a check that day but didn't take any taxes out. How much can I make without having a 1099 sent to the IRS? No state taxes to worry about here. :) The tax situation wasn't discussed at the interview and I assumed I would be put on the payroll like a full time employee.

 

This is a unique job opportunity for me because of being on Saturdays, I can easily find child care. With my career there are 5++ people waiting to take this position if/when I give it up.

 

Thank you!

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I believe the 1099 minimum was $600, but I'm not sure if it's been set for 2014 yet.

 

I would clarify with the business. Some places try to call employees independent contractors when they are not, and there are legal implications if, for example, there's an accident and you or someone else gets hurt. It also affects your actual pay rate because you would be responsible for paying payroll taxes, etc. as an independent contractor. And you might need to carry workers comp or liability insurance if you aren't on their policies.

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If you are an independent contractor, they should have explained that and possibly had you sign something acknowledging it. If they are controlling your hours and days of work, you are less IC and more part time employee. It's a fine line they walk.

 

I agree, 600 is the limit I remember.

 

They are required to send you a 1099 at the end of the year, but it never hurts to keep up with what you make from them so you know what's what.

 

 

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Is there a dollar amount you need to make before they take out taxes? Did you sign a w4? I worked part time last year (only for a few weeks) and they took very little out for taxes - of course my income was small as well. I was issued a W2 at the end of the year. 

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I do a lot of 1099 work as an independent contractor, and the 2014 limit is $600.  Keep in mind that even if they don't give you one (I've had this happen), you are still legally required to report it as income.  If the IRS catches them not doing that and figures out that you had unreported income...well, not good.

 

I prefer to work under a W4, but some employers prefer 1099 workers for set jobs.

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If you are on a 1099  you are Self Employed. You are not an employee if you on a 1099. The I.R.S. takes a very dim view of people who are working on a 1099, and of employers who want to classify them as "Independent Contractors". They look at this situation when they are looking for tax evasion.

 

If your net earnings from Self Employment are more than USD$400 (?) you will need to pay Self Employment Tax (Social Security Retirement and Medicare), when you file your I.R.S. Form 1040. Also, you need to pay any Federal Income Tax that might be due, on  your Self Employment income.

 

The company you are working for should have explained to you that you need to provide written proof to them that you have Workman's Compensation insurance and Liability Insurance policies to protect them.

 

Probably this arrangement is a good thing for the company where you are "working", but it is NOT a good thing for you.

 

They are not paying Unemployment Insurance for you or a variety of other taxes.

 

You will need to file I.R.S. Schedule C with your U.S. Income Tax return.

 

 

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Thanks for all the replies.

 

Im so confused I don't even know where to begin to ask questions at this point. :( This was not discussed at the interview.

 

I cannot be self employed, I don't think because it is illegal for me to work on my own in my field. Nothing was discussed regarding workers comp ins or malpractice. I have worked for temp agencies before and that day's employer would cut a check and not take out taxes. I've had to declare that with a 1099. I don't want to do that again.

 

 

I'm scheduled to work this Saturday and with the 1 day I've already worked that total would put me just under $400. Is the dollar amount $400 or $600 that I have to declare with the irs or does it depend on how I am classified? I don't want to cheat the irs or anyone else but I don't want to pay ss and Medicare on a job that isn't worth it due to commute and pay. I took it just to pay for some extra travel and vacations, it isn't going on my resume.

 

Thanks again. I'll probably have more questions.

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Thanks for all the replies.

 

Im so confused I don't even know where to begin to ask questions at this point. :( This was not discussed at the interview.

 

I cannot be self employed, I don't think because it is illegal for me to work on my own in my field. Nothing was discussed regarding workers comp ins or malpractice. I have worked for temp agencies before and that day's employer would cut a check and not take out taxes. I've had to declare that with a 1099. I don't want to do that again.

 

 

I'm scheduled to work this Saturday and with the 1 day I've already worked that total would put me just under $400. Is the dollar amount $400 or $600 that I have to declare with the irs or does it depend on how I am classified? I don't want to cheat the irs or anyone else but I don't want to pay ss and Medicare on a job that isn't worth it due to commute and pay. I took it just to pay for some extra travel and vacations, it isn't going on my resume.

 

Thanks again. I'll probably have more questions.

 

You have to declare ALL of your income, regardless of what form you receive, or how you are paid, IF you make more than $1000 in a year from ALL of your income sources put together. They will give you a 1099 if you earn more than $600 from them in a year, and are considered a contractor rather than an employee. They will give you a W2 if you are an employee, and they will take out taxes, including social security.  If you are getting a 1099, than they do NOT take out taxes. You  pay the taxes, including social security, when you file your tax return, generally using the self-employed form.

 

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