and only made around 3,000 dollars, but didn't file, is the IRS going to come for me? I was a restaurant delivery driver and didn't want to go through the hassle of adding up all the miles I drove and what not. When I received my 10-99, I was amazed I even made that much. What will come of all this? Smart alecs need not answer.
2007-09-28 05:23:29 · 8 answers · asked by HERE WE GO BROWNIES, BEAT PIT!! 3 in Business & Finance ➔ Taxes ➔ United States
Great, I am screwed. I'm not sure where my Driver Log is anymore, so I'm not sure how I can get whatever the amount will be, deducted. Hopefully, since I claimed 0 for the job I have now, they will take the money I am supposed to get back this coming tax season. I guess I could always say I never received a 10-99 form. Thanks for everyone who answered.
2007-09-28 07:53:46 · update #1
If that's all you made, you probably won't owe any taxes but you are still required to file. Go to the IRS site and you can file for an extension. If you only have the one 1099, it will be very easy. You can file a 1040EZ.
2007-09-28 05:29:26 · answer #1 · answered by Suzy 5 · 1⤊ 5⤋
As others have stated, you must file a return or you will owe more than is necessary. You will not owe income tax, but you will owe about 15% of your net after expenses to SS and Medicare. This is paid through your tax return.
First, if you believe your 1099 is wrong, ask for a correction. Were you paid by check and did you keep records? If your pay was overstated, get it fixed.
Next, you need to reconstruct your mileage. Do the best that you can. How many weeks, and what was the typical week?
Each mile you drove your own vehicle you can deduct 48.5 cents per mile.
Say you drove 3,000 miles. That reduces your net income by about half and you will owe about $230 in taxes.
If you wait, you will pay two or three times that amount, so don't delay. Use Form 1040 with Schedule C-EZ and Schedule SE, all available at irs.gov.
2007-09-28 07:53:02 · answer #2 · answered by ninasgramma 7 · 0⤊ 0⤋
You will get a notice from the IRS indicating that they have income reported to them for you, and they don't have a return for you. They will then prepare a return for you and send you a notice regarding it. Because you are an independent contractor, you'll be liable for Self-Employment (SE) tax. You won't be liable for regular tax if the $3,000 was all you made because your standard deduction alone will wipe that out. SE tax is 15.3% of 92.35% of net self-employment income. Since the IRS will only know of the 1099 income reported to them they will base your tax on that without any expenses. For income of 3,000 your SE tax would be $424. They will also include interest and penalties in the notice along with the tax. It would be in your best interest to file a return, with adding up all the miles you drove, as those are deductible expenses for you. If you don't file a return, the IRS will.
Suzy is incorrect about not owing any taxes, you will owe self-employment tax.
2007-09-28 06:37:23 · answer #3 · answered by Anonymous · 1⤊ 0⤋
Yup, unless you hurry up and file, they are going to come after you. You won't owe any income tax, but probably owe around $415 in self-employment tax (for social security and medicare), plus interest and penalties for filing late. It might take them another year or so before they get to those issues from 2006, but then you'll just get a demand from them for whatever you owe - and by then, the penalties and interest will have grown quite a bit.
You could have deducted your miles driven for deliveries if you had kept records, but since you didn't, it's probably too late now.
And one other thing I know you won't want to hear: your tips are taxable income, so if those weren't reported to your employer and included in the $3000, then you are required to include them on your tax return.
To file, you'll need a form 1040, a schedule C or C-EZ, and a schedule SE. You can't use a form 1040EZ for 1099 income as one answer above wrongly says.
2007-09-28 15:20:45 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
Eventually the IRS will prepare a tax return for you and assess the tax based upon what information they do have available. They will also tack on penalties and interest for late filing and late payment. They'll hit you up for at least $450 in Self-Employment taxes at the very least if that's your only income. Plus those pesky penalties, of course!
Get off your duff and file the proper return! The penalties and interest will continue to add up daily until you do.
2007-09-28 05:50:47 · answer #5 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Figure the miles you drove in a typical day and multiply it by then number of days you worked to get a guesstimate of what your mileage expense would be againt your paltry $3,000. You probably be amazed when you find out how screwed over you were.
If you filed a tax return showing wages, your 1099 is eventually going to get on the radar. Fix it now.
2007-09-28 06:10:47 · answer #6 · answered by Anonymous · 0⤊ 1⤋
Do not delay, file your return. You may not have any federal tax or state tax liability, but you are required to pay self employment taxes at 15.3%.
If anyone has a self employment income of $400 or more, he/she is required to file the return.
2007-09-28 07:28:53 · answer #7 · answered by MukatA 6 · 0⤊ 0⤋
The IRS might or might not contact you. The correct thing to do is file the 2006 return now.
2007-09-28 05:30:04 · answer #8 · answered by r_kav 4 · 1⤊ 2⤋