1099-MISC earnings, but just a student and not self-employed????

Question

I was planning on filing a 1040EZ, but I can't find a place to claim my "Nonemployee compensation" from box 7 of a 1099-MISC. I don't have a sole-prioprietorship by any means, I'm just a part-time bookkeeper that a tiny non-profit company didn't want to put on their payroll for some reason. What should I do?

Answer 1

Yep. We see this all the time at the office. You'll have to put this 1099-MISC income on a Schedule C (yes, I understand it's contract labor, and yes, I understand that the IRS considers it Self-Employment income, anyway).

You'll enter the income on Schedule C, and then carry the net profit -- which will more than likely be the same amount because of not having expenses to offset it -- to the Schedule SE, which will tell you how much Self-Employment tax you'll owe.

Then, you put 1/2 of the Self-Employment tax in on the front page of the Form 1040 under Adjustments, and you get to subtract that from your income.

The rest of the form is pretty much the same information as the 1040EZ would have, but it will look different on there.

Now, as a student, if you are being claimed as a dependent on your parents' return, be sure to check the "magic box" as I call it, that shows you are being claimed as a dependent on someone else's return. Then on page 2 of the 1040, go ahead and enter your Standard Deduction amount of $5150 and subtract that from your Adjusted Gross Income.

This is Very Important: If you ARE a dependent on someone else's return, do NOT enter $3300 for personal exemptions because that dependency shifts your personal exemption to the other tax return.

Enter the Self-Employment tax on the appropriate line in the section for other taxes, and figure the rest of the return as you normally would have.

Sorry to be the bearer of bad news, but you have to do the return the right way, because the IRS will be looking for that 1099-MISC income on your tax return, and they'll assess Self-Employment tax against it if you don't go ahead and put it on there.

Wish I had better news for you. I always suggest to my clients that they "pinch off" 10% of their gross earnings and deposit that into a savings account throughout the year, so that at tax time, they'll have enough saved to cover any Self-Employment tax they might owe. And, hey, if they don't owe it, the little account keeps drawing interest until it is needed.

Answer 2

If you have non-emplloyee compensation on a 1099-misc, then by definition you're self employed and will need to use a 1040, a schedule C or C-EZ, and a schedule SE.

Answer 3

You ARE self-employed in this case. (You're a bookkeeper and don't know this??)

You have to file Form 1040 and attach Schedule C or C-EZ to account for the business income and expenses. If the net profit is $400 or more, you need to include Schedule SE to calculate the self-employment tax at 15.3% of the net profit.

Answer 4

Congratulations! You've just entered the world of being self-employed! Form 1040-EZ is no longer an option for you. Assuming you have no deductions to offset your self-employment income, you'll need to put the income either on Schedule C, or under "miscellaneous income" on Form 1040. Either way, you're going to need to calculate self-employment tax, which needs to be paid in addition to your regular income tax.

If I were you, I'd go out and buy TurboTax or TaxCut at your local WalMart. Filling in the Schedule SE (Self Employment Tax) can be a bit tricky, and a tax program can buzz right through it quite easily.

BTW, you should be considered as an employee, most likely. The not-for-profit is trying to get off cheap by not paying you as an employee. Unless you're free to come and go as you please, I'm guessing that you should be an employee and the not-for-profit could get busted by the IRS if they frequently hire people as subcontractors that should be employees.

Answer 5

while you're no longer residing interior the family of your mothers and dads and that they do no longer look to be offering to your help, of course you're no longer their based you purely point out you reside in Iowa and confident your W-2 out of your job will point out your taxable earnings and the quantity of earnings tax withheld in the adventure that your different job subject concerns you a 1099, of course which would be suggested on Sch C and if the internet volume is $4 hundred or extra you will additionally document a Sch SE numerous those are blanketed at the same time with your 1040 the SE will calculate your self employment tax you have the exemptions of your self and your babies, the usually occurring deduction, in case you employ the practise credit, it reduces your gross earnings, in case you employ the AOC for training which would be a reimbursement you have earned earnings which entitles you to the EIC, you'll be waiting to apply the youngster tax credit, yet very probable the further newborn credit after all

Answer 6

You have to file a schedule C and a schedule SE. By the IRS definition, you are self employed. I don't think you can use a 1040 EZ. I am not sure though, as I always use a 1040. It has everything on it.

Answer 7

The tiny non-profit didn't want to put you on their payroll because they didn't want to pay your social security taxes - 7.65% - and now you're liable for both employer and employee portion - yup, 15% of your income will go to pay social security.

However, you might qualify for some other credits that will help.

On the tax form - you put the amount as wages, put withholding for social security as zero, and the tax program will tell you what you owe.