thought was hired as employee, told contracted@st check, how to file taxes?

Question

when received 1st ck was told contracted not employee, will receive 1099 v w-2. how to file taxes. any way to fight status

Answer 1

As a contractor, you are considered (by the IRS) as self-employed, not an employee of the company. It's like being a temp. Most likely the company will not deduct/pay Social Security; pay your health insurance, etc. You also may be able to deduct some expenses that are required to do your job. You will probably receive a form 1099 which is also sent to the IRS. I suggest you go to the IRS web site and look closely at a Schedule C. I also suggest that you find a tax return website/software to help you through. I personally use TurboTax, but H&R Block has a site as does the IRS.

Answer 2

IRS Publication 15-A: Employers' Supplemental Tax Guide gives the rules for determining whether a person is considered an employee or an independent contractor. See the section titled "Who Are Employees?" on page 3:

http://www.irs.gov/pub/irs-pdf/p15a.pdf

There's also Publication 1779: Independent Contractor or Employee?

http://www.irs.gov/pub/irs-pdf/p1779.pdf

You might also want to read the FAQ's on Employee/Independent Contractor:

http://www.irs.gov/faqs/faq-kw54.html

There's also a form that can be completed and sent to the IRS for them to make the determination. Usually the employer would ask the question, though. There's a link to the form from the FAQ's.

When doing your taxes, treat a 1099 just like a W-2. It says how much money you earned, just no taxes withheld info since no taxes were withheld.

Answer 3

You may need to file a schedule C, though there is a separate place on your taxes just for 1099's. The only drawback is that you will have to pay the whole amount for Social Security instead of just half. Your employer normally pays half. So your "wages" just got cut by almost 8 %. Sorry. Also, if you want to take out an IRA it will be a SEP IRA (Self-employed pension) instead of a Traditional IRA. You can still do a ROTH IRA.

Answer 4

Look up the info datette provides links for. You will learn a lot there. Also, when hired, did you go to HR and fill out paperwork? Was there any kind of contract you signed?

Answer 5

probably as self-employed. ask the boss to be sure!