HELP! freelance worker, never filed taxes, what should i do?!!?

Question

I am a freelance makeup artist and paid mostly in cash..i also work in a day spa about one day a week and make commission (usually no more than $100) and I am paid in check..my work hasn't sent me any sort of tax forms.

I put most of my money into a checking account..My living expenses are very cheap, i live with my boyfriend and I really only have a car payment to pay monthly, but that's about it.

I haven't filed taxes in prob about 5 years..Any advice would help!

oh, I do know that I do not have a state tax where I live.

Answer 1

Get a note book and every day write down how much you are paid and what your expenses are. If you have to buy a cream to do the job, cosmetics, rent at spa- whatever it is an expense/ write it down.

Every week is the revenue after expenses is over $2,000 forward 20% to the US government through the IRS, They will forward you the forms. Also 5% to your State government, they have a form too. Make certain to keep receipts of these payments and write it in your book. YOUR ACCOUNT NO IS YOUR (SSN) social security number.

If your income is not that high, send the same percentages to the same places Monthly. As things now stand your business starts as soon as you start keeping records.

Answer 2

Are you asking what you have to do to be legal? Freelance work is taxable income, and if you made over $400, you're required to file a tax return. You need to keep good records of all of your income, whether anyone sends you a 1099 or not, and expenses related to your business. You’d file a tax return for each year, showing your income and expenses on a schedule C or C-EZ. You’d also fill out a schedule SE to figure your self-employment tax – this is for social security and medicare.

To really be legal, you’d have to go back as far as you had income. If you just start filing now though, you’d be legal for years from now on, although the IRS could still come back on you for past years if they found out you had income then. Starting to file now would not likely increase your chances of being caught up to for the prior years.

If you make around $100 a week at the spa, they probably should have sent you a 1099. But if they didn’t, you’re still the one responsible for the taxes.

Good luck.

Answer 3

When I hire someone to do work in my home, I pay by check. Since it's my home, I don't issue a 1099-Misc. Depending on the exact work being done, I may be correct that the individual is NOT my employee, so I wouldn't issue a W-2 either. Thus, there may be no 1099-Misc or W-2 forms showing income and she may be slightly off the IRS radar. However, living on cash and trying to avoid the IRS/state gets to be a problem. There's an old joke about drug lords all living with their mamas because they can't get a mortgage loan (no proof of income and the interest payments would tip off the IRS that they have the income to pay it) and paying in cash triggers a cash transaction form--too many of which gets the governments attention. She also can't just keep the money in the bank or spend too much of it because if the IRS does a lifestyle audit, she'd have to explain where the money came from. Now, flashforward to age 67. She can't collect SSA benefits either because she never paid into the system.

Answer 4

Call your employeer and ask if they intend to send you a W-2 or a 1099. If they don't and your income for the year exceeds $600 you should still file taxes.

Answer 5

Ask your company if they filed you...

They might not have filed you and so you can get away with not filing for this year....

But if they did file you and they are taking taxes out of your check then you should contact the IRS and tell them that you are expecting your company to send you paperwork for back taxes... claim that you were not aware that they were taking taxes out and act all ignorant and confused.... or get a tax attorney.

But you must be prepared to pay back taxes and it will help if you show signs of wanting to work with the IRS on the matter. If you try to hide from it... they'll get you sooner or later.

Answer 6

if i were you, id file a schedule C claiming the income you received by checks (if it was over $600). this way you can claim any expenses you may have had that you paid out of pocket. for example, if you pay for make-up, supplies, travel, etc. they can all be deducted on your tax return. you may be entitled to tax credits (i.e. earned income tax credit) that you arent aware of.

Answer 7

I suggest you find a regular paying job like us normal folks and settle down. stop living coast to coast. get on your own, leave the boyfriends nest. you sound very unorganized!