2007-08-20 10:41:28 · 6 answers · asked by thekilpatrickfamily 2 in Business & Finance ➔ Taxes ➔ Other - Taxes
This is for my wife. She will be getting paid for watching another kid. The lady I assume will claim this on her taxes so I think we have to as well right?
2007-08-20 11:21:34 · update #1
Okay. We file married joint but we weren't sure with her making some $$ on the side if it would hurt us.
2007-08-20 11:29:03 · update #2
If the person paying your wife is claiming the child care expenses on her return then your wife will need to report the income, if it exceeds $1. The good news though is that she can offset the income (reported on a Schedule C form) with the expenses she has incurred in earning the income. If her net Schedule C income exceeds $400 she will owe Self-Employent (SE) tax, and the tax will be 15.3% of 92.35% of the net Schedule C income (unless she has already had social security wages of $97,500, then in that case it would be 2.9% of 15.3% of the net Schedule C income).
2007-08-23 04:46:57 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Since you're filing a joint return, all of her income must be reported.
It can't "hurt" you unless the tax rate is higher than 100%. That's never been the case in the US. The current highest rate is 35% and most likely you'll be paying much less than that. With the 15.3% self employment tax, the worst case scenario is 50% with 30% or 40% being much more likely.
2007-08-20 14:13:53 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
If she is already filing, like a joint return with you, then she has to report income from the first dollar. If you are filing separately, then she has to file if her income is $400 or over for the year, since it sounds like it would be self-employment.
2007-08-20 11:23:54 · answer #3 · answered by Judy 7 · 0⤊ 0⤋
If you are self-employed and it is your only income, the filing requirement is $400. Anything above that requires a return.
If you are single and a W2 employee, the filing requirement is $8750 ($5350 if you are claimed as a dependent by someone else).
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Assuming your income already puts you over the filing requirement, her income will need be reported from dollar 1.
Make as much money as you can. You can not come out behind because of income taxes.
2007-08-20 11:19:10 · answer #4 · answered by Wayne Z 7 · 0⤊ 1⤋
I think that if you make any money at all you have to file, but it might be in your best interest to do so if you don't make much.
2007-08-20 11:15:51 · answer #5 · answered by Anonymous · 0⤊ 1⤋
The following web site will answer all your questions.
Good Luck!
http://www.irs.gov/pub/irs-pdf/i1040gi.pdf
2007-08-20 11:08:41 · answer #6 · answered by cth5x9 2 · 0⤊ 2⤋