What does it mean when you "choose to declare" your taxes?

Question

I got a new job over the summer and he said they don't take taxes out, so at the end of the year I'll have to file and declare for my taxes. I'm really confused as to what I'm supposed to do.
Do I choose how much I tell the government I've earned? Or what exactly will I have to do when tax time comes?

Answer 1

"Declare" means that you report it on your income tax forms. You can chose to declare your income or not. If you don't declare all your income, it's called "income tax evasion" and it's a crime.

If have income that is not subject to withholding, you need to file Form 1040ES making quarterly estimates. Waiting until the end of the year and owing a lot of money can cause you to have to pay penalties and interest.

I assume that you are a self employed independent contractor who will get a 1099 at the end of the year, because if you are an employee who gets a W2, you employer can't "choose" to not take taxes out. The Internal Revenue Code requires employers to withhold according to a formula specified in the regulations. Anything else is illegal.

Answer 2

You always have to report any income you make to the irs. If your employer does not withhold taxes from your check, you may have to pay those taxes yourself out of pocket when you file your tax return. Some employers do withhold taxes for you, but that does not necessarily mean you are not liable for taxes.

It is hard to tell what you may owe since you don't give your age,etc. If you are younger and still a dependent on someone elses return you may not owe anything. At the end of the year, you can do your returns (1040) to help you figure out how much you owe, if anything. If you are not a dependent, or if you plan on earning more than 5,000 in 2007, you may have to pay taxes. Put a bit of money aside for this, so you are not stuck with having to pay them all at once.

Talk to a friend or your parents for help with everything once the time comes.

Answer 3

Tax Declare

Answer 4

You are the first clueless independent contractor of the day. Here is my standard cut and past description of what is happening to you.

My canned explanation to clueless independent contractors seems to get posted every day:

Some employers try to get around paying employment taxes (social security and unemployment) and other employee benefits like workers compensation insurance by improperly classifying employees as independent contractors. If you are required to show up for work--personally--at a particular time, punch the clock, use the employers equipment and are paid an hourly rate, you are an employee. If you didn't understand the difference when you posed your question, I would be even more convinced that you are an employee. What is your preference, Slotted or Phillips? Complete an IRS Form SS-8 to get an official ruling on your status. This will help you get unemployment if you get fired.

Answer 5

if you are an employee not a contractor, they are violating federal law and IRS regulations.
the will give you a 1099 at the end of the year and you will be required to pay All federal and state income tax, pay medicare tax, self employment tax etc. This will be about 30 percent of your gross you receive during the year. Be prepared to have that much money set aside to pay your taxes.

Answer 6

When people in congress write bills, they slip in things they want for their district/state. One of the bills signed by Bush included tax increases. He didn't know it when he signed it, probably because he didn't read the bill. Something the people in congress don't seem to think is a big deal nowadays. In fact there are people in congress who are making a joke about actually reading the bill which would drastically alter the healthcare industry.

Answer 7

If they don't take any taxes out, they are probably violating the law.