I was in the process of moving in January 07' and I never received my tax forms for my previous job. I was a "self-epmloyee" so no taxes were taking out of my checks throughout the year.. I started my job in early 06' and I probably made around $10,000 for the year. What should I do? What are the penalties for not filing on time and how much am I looking at paying? Please help me soon because I know I need to get this taking care of as soon as possible!
2007-07-23 07:29:16 · 9 answers · asked by dukefan826 1 in Business & Finance ➔ Taxes ➔ United States
by being self-employed you will have fill out a Schedule C as part of your 1040 income tax return, and declare the $10,000 in income on that form. Unfortunately by being self-employed you will have to pay self-employment tax in addition to the regular income tax. For the $10,000 in income if you are single and had no dependents, you would get to take the standard deduction of $5,150 for a single person, and the personal exemption of $3,300 leaving you with $1,550 in taxable income, which would have a tax of $156. Unfortunately the self-employment tax would be 15.3% of 92.35% of the $10,000, and that tax would be $1,413. You would also owe interest and penalties on top of that. The IRS might or might not be willing to waive the penalties, but doubt it on the interest. Your best bet though is to file your 2006 tax return ASAP. As far as an extension as some of the other answers are suggesting, you would have needed to file the extension by the tax filing deadline, April 18, 2007, and still have paid the tax that you owe in order for the extension to be valid.
2007-07-23 08:11:49 · answer #1 · answered by Anonymous · 1⤊ 0⤋
A. Contact the company you worked for and get a copy of the 1099 that they issued.
B. If you need help, get the 1099 and any additional information to a tax accountant for preparation of the return.
C. Submit your returns to the IRS and State asap (before 8/15/07) The IRS late filing penalty is 5% per month (or portion thereof) late.
There are too many unknowns to tell you how much you may (or may not) owe. The IRS may be simpathetic and you can write and ask for an abatement, but on April 15th, you should have filed an extension - that would have cut your penalties down to late payment of only .5% per month. Also, while it is possible the IRS could abate the penalties, it is not likely.
2007-07-23 08:27:25 · answer #2 · answered by bbcpa7 2 · 0⤊ 0⤋
Get it filed as soon as possible - penalties will continue to accumulate until then. For info on penalties see page 19 or IRS Publication 17, download it at irs.gov. You are looking at a late-filing penalty of 5% per month, with a minimum of $100. There is also a late-payment penalty of 1/2% per month.
Penalties can be waived if you can show reasonable cause for not filing, but I doubt that the IRS will accept "I moved in January" as a good reason for not filing until July or later.
2007-07-23 11:27:48 · answer #3 · answered by Judy 7 · 0⤊ 0⤋
The truth is you'll need to file a schedule C and a schedule SE and form 1040. You will probably have to file your state taxes as well unless you are in a state that does not have income tax.
In order to determine your total liability you'll have to calculate your net profit first on the schedule C. Then carry that number over to your form 1040.
You have not given enough information to determine how much you will owe because you need to know your age, filing status, and whether or not you filed any estimated tax payments during the year. The penalties are based upon what you earned and paid the year before.
2007-07-23 07:37:55 · answer #4 · answered by Jessica M 4 · 1⤊ 0⤋
You should immediately file your return with a letter explaining the situation. The money that you owe and you will owe some money should be remitted. The IRS will charge you penalty and interest on the amount due. However if you co-operate and request it, the penalty will probably be waived, especially if you do it now since you could have received an automatic extension to 8/15. Based upon $10K in earnings you should owe a lot of tax and the interest will be minimal, the penalty will probably be waived.
2007-07-23 07:35:32 · answer #5 · answered by Anonymous · 0⤊ 1⤋
The best bet is to do them ASAP. The longer you wait, the more money you'll have to pay (the IRS charges interest on money owed). You can make arrangements for a payment plan if you owe taxes. You will probably get fined, but it is better to work something out with the IRS then to ignore the problem and hope it will go away.
2007-07-23 07:50:19 · answer #6 · answered by amysgetaways 3 · 0⤊ 0⤋
File your return asap. If you only made $10,000 and you are married and / or children and there are no other sources of income, you may be entitled to an earned income tax credit which could reduce what you owe or maybe be receiving a refund. Don't forget about the telephone tax credit (which is really a rebate although th IRS called it a credit).
2007-07-23 07:39:53 · answer #7 · answered by IRENE THE BOOKIE 3 · 1⤊ 1⤋
Call the IRS first and second use your very last paystub for 2006 to file taxes. The IRS might let you still file an extension if you explain the situation and they know you are trying to take care of the issue. If you only made around 10 grand they probably will owe you money. But first call the IRS because they may be able to help get the correct amount for you to file and give you the info you need.
2007-07-23 07:38:42 · answer #8 · answered by kella l 3 · 0⤊ 3⤋
call an accountant or a tax attorney who can advise you properly.
2007-07-23 07:32:24 · answer #9 · answered by thunder2sys 7 · 0⤊ 0⤋