tax penalties! always worked under w2, first time filing taxes on my own as independent, and i get a 1099!?
so i didn’t keep record of taxable expenses nor did i pay taxes for that 2007 income thinking company did. now how much do i owe irs? are cpa’s affordable? i’m in tx and i’d rather pay all my debts than pay to know how much i owe, just need advise on how to? and what’s next? for this 2008 paychecks i’d file as self-employer? what forms do i need to make the quarterly payments? do i need to file for something else at work life expenses? but what can they deduct from if i don’t own house or even car?! i work as student besides this, don’t know if it makes a difference… i’m not at the level of being my own business, and i’ve heard lots of negative things against being self-employer and taxes, but are there any good points to it? remember i’m a newbie on taxes, help much appreciated!
,,Is it legal what my employer doing? Employer did not did the proper deduction of payroll taxes, now want 1099? ,My most recent employer is trying to register me as and independent contractor to avoid payroll taxes. Help? ,Will I get all of my federal and GA state taxes back if I’m a independent full-time student? ,missed taxes last year – penalties for it, and back-tax filing? ,What are the penalties for filing late taxes? ,Tags: 1099., Always, filing, first, Independent, penalties, taxes, Time, UNDER, worked
Comments (4)
A CPA will probably cost you several hundred dollars, but at this point might be your best bet unless you are comfortable with something like TurboTax.
Hard to say how much you might owe without knowing how much you made and what other income you had, if any. You’d file a schedule C or C-EZ showing your income and any associated allowable expenses, and a schedule SE to calculate your self employment tax. The numbers from the bottom of the two schedules will go onto a form 1040 (not 1040EZ or 1040A) to calculate your total tax owed.
For quarterly estimated taxes, you use a form 1040ES – due dates are 4/15, 6/15, 9/15, and 1/15 of the following year.
Good luck.
first of all it not that bad being self employed. go to the irs.gov web site and down load the forms for estimated quarterly taxes there are also a bunch of deductions you can take. there are many web sites to help you figure out what to deduct. if not stop in a tax office they usually have a list and can make a copy for you. just remember to keep records of everything. get a folder and every time you get a receipt put in there so u will have it. just do some searching on the net to help you get all the answers you need and dont be afraid.
If you did not know you were going to receive a 1099 you may have actually been an employee and your employer is taking the easy way out by sending you a 1099. The IRS frowns on this and you would be much better off as an employee if that is what you actually are. You can go to irs.gov and check it out.
http://www.irs.gov/businesses/small/article/0,,id=99921,00.html
Independent Contractors vs. Employees
Before you can determine how to treat payments you make for services, you must first know the business relationship that exists between you and the person performing the services. The person performing the services may be -
An independent contractor
A common-law employee
A statutory employee
A statutory nonemployee
In determining whether the person providing service is an employee or an independent contractor, all information that provides evidence of the degree of control and independence must be considered.
It is critical that you, the employer, correctly determine whether the individuals providing services are employees or independent contractors. Generally, you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. You do not generally have to withhold or pay any taxes on payments to independent contractors.
Caution: If you incorrectly classify an employee as an independent contractor, you can be held liable for employment taxes for that worker, plus a penalty.
Who is an Independent Contractor?
A general rule is that you, the payer, have the right to control or direct only the result of the work done by an independent contractor, and not the means and methods of accomplishing the result.
Duplicating in part the previous post and adding some stuff.
I have a canned explanation to apparently clueless independent contractors and, if you are asking relatively simple questions in this forum, no offense, but you qualify as clueless:
Some employers try to get around paying employment taxes (social security and unemployment) and other employee benefits like workers compensation insurance by improperly classifying employees as independent contractors. The basic issue is the amount of control the employer has over the worker. If you are required to show up for work–personally–at a particular time, punch the clock, use the employer’s equipment and are paid an hourly rate, or another set rate based on time served, you are an employee. If you didn’t understand the difference when you posed your question, I would be even more convinced that you are an employee. What is your preference, Slotted or Phillips? Complete an IRS Form SS-8 to get an official ruling on your status. This will help you get unemployment if you get fired. When you file your income tax return, you can attach Form 8919 Uncollected Social Security and Medicare Tax on Wages and only pay the employee’s half of social security. You will still have to cough up all the income tax. IRS and the states are stepping up enforcement in this abuse area.