Category Archives: Independent Contractors

California Budget

Today TaxMama hears from CJ in Concord, California has an urgent request. “Time is short on this one! Do you have any information about a bill being put before the California legislature tomorrow – (June 22) that would allow the state to have 3% in taxes withheld from payments to independent contractors, independent distributors, etc.? […]

Amending Very Old Returns

Today TaxMama hears from Mark in West Virginia with this problem. “The IRS thinks I owe them money from 1999. I have proof to the contrary, but they say I can’t file a 1040x after 3 years. Even the Tax Advocates told me that. My father acting as my power of attorney filed it through […]

Sole Proprietor

Today TaxMama hears from Kathy in Florida who tells us. “My husband currently works “under the table”. We declare his total income and are subsequently hit every year with owed taxes. Would it behoove us to make him a sole proprietor of his own yacht cleaning business? Would we be saving on taxes, or would […]

Trucking Along

Today TaxMama hears from Jim in Los Angeles, who tells us. “I run a trucking business. This will be my first year hiring contractor drivers so I want to know, at the end of the year when I give them a 1099 am I supposed to send one to the IRS with my corporate tax […]

Dispelling Tax Myths

Today TaxMama hears from Brian in Connecticut, who says. “I did some work for a guy in 2007. He paid me with business checks totaling $6,100.00 with no deductions. He refuses to give me a 1099. What should I do?”

New Form for Employees Misclassified as Independent Contractors

In 2007 were you an employee whose employer paid you as an independent contractor? Employees usually receive a Form W-2 while independent contractors usually receive a Form 1099-MISC. Generally, a worker who received a Form 1099 for services provided as an independent contractor must report the income on Schedule C and pay self-employment tax on […]

Missing a Form 1099?

Courtesy of the Internal Revenue Service TT-2008-25 If you receive certain types of income, you may get a Form 1099 for use with your federal tax return. Form 1099 is an information return provided by the payer of the income. The payer should send or provide your Form 1099-series information returns by January 31, 2007. […]

Misclassified Workers to File New Social Security Tax Form

Employees who were misclassified by their employers as independent contractors should use new Form 8919, Uncollected Social Security and Medicare Tax on Wages, to figure and report their share of uncollected social security and Medicare taxes. Find out more in news release IR-2007-203. —- TaxMama Note: “Misclassified” in this case, means – workers that were […]

Outsourcing

Today TaxMama hears from Shawn in New Jersey who tells us: “I plan to be an independent contractor working with architectural renderings. My friends in Asia will be actually doing the work. I will be getting the jobs, collecting the fees, and paying the Asian rendering team. How do I handle this for taxes, since […]

Should I Report Income?

Today TaxMama hears from Michelle in Pennsylvania, who has this dilemma, “My husband was working and receiving $300 a week for 7 weeks. He was paid with a personal check. Do we claim that? Because his boss will not be claiming him, I was not sure. Some people told me no; some people told me […]

SS-8 – or Dishonest Boss

Today, Nancy from West Virginia is confounded, “My boss sent me a 1099 instead of a W-2. But I was an employee, not a freelancer. What do I do?