The Small Business Tax Help Blog

Posts Tagged ‘independent contractor tax form 1099’

Question: Tax Help?? Independent Contractor~I do NOT own a business, my “clients” 1099′d me?

What form do I use to file for all my itemized deductions (time, travel, planning, catering, budgeting, meetings with clients for menus, etc…..) I’m pretty lost……Any help would be great, I posted this earlier, and I got some info on Owning a Business…….I don’t own a business…..Do I use a 1040 long form or is there another one?? I was told Schedule C and Schedule SE were used, but those are for business owners, which I”M NOT…….Any help would be great…..And I know it’s the last minute, but I’m also filing an extension…….Thanks in advance……
I’m a private chef for 3 families here in Encinitas…….I was 1099′d by ALL of them, I didn’t know that I was going to be, I thought I was going to be able to fill out a 1040 form. I may be a culinary genuis, but when it comes to taxes, I’m a complete moron, obviously…….

Answer: First, I realize you do not own a business. However, as an independent contractor, you are considered self employed, and therefore you file taxes as though you were running a business. Your business name is simply your name, and your business ID number is just your social security number. Basically, YOU are the business. It doesn’t matter that you don’t have a business license, that’s not an issue, but for income tax purposes, you have to file as though you were running a business.

If you’re just starting now, I highly suggest you file an extension and include whatever payment amount you can afford. Then hire a tax pro or accountant to help you. Anyway, this is what you do:

Use a 1040 long form.

Attach schedule C with all your income and business related expenses. Schedule C is designed to help you determine your net profits from self employment. The net profits go onto your 1040 as income.

If your net profits were more than $400, you also need to include schedule SE. This schedule computes your self employment tax. Its 15.3% of your net profits. This is the money you would have had taken out of your paycheck (plus your employer’s contribution) for social security if you had a regular job. The total self employment taxes will go onto your 1040 as taxes owed.

Just to clarify. A deduction is something that you are allowed to deduct from regular income taxes, such as mortgage interest or charitable donations. An expense is something where you had to spend money as part of your “business” (or independent contractor work), so it reduces your net profits, and lowers your personal income.

Adjusting Your Withholding and Estimated Tax Payments

Now is a good time to look at the amount of tax that you have withheld from your pay, pension or Social Security, as well as any estimated payments that you make throughout the year.  The amount of any payment that you had to make on April 15 should be fresh in your mind – and if it was a sizeable amount you should review the situation and quite possibly adjust your withholding or estimated …

1099 Independent Contractor vs. W-2 Employees

Question: What tax forms do I need independent contractors to fill out for my small business?

I am starting an online tutoring business and hiring my tutors as independent contractors. Do I need them to fill out an IRS forms with me when I hire them? What do I have to do accounting-wise for my employees?

Answer: 1099 R

Work-Product Battle Reaches Supreme Court

Lawyers for Textron Inc., an aerospace and defense contractor, have filed a petition for certiorari in a closely watched federal tax case, asking the U.S. Supreme Court to resolve a substantial circuit split over the interpretation of the work-product privilege in Federal Rule of Civil Procedure 26(B)(3). The U.S. Chamber of Commerce and the Association of Corporate Counsel have submitted amicus ...

WEB ALERT: California Independent Contractor Withholding Proposal