My employer does not take any deductions from my pay and I will not receive a W2. How do I file a tax return?

Question

I am an insurance agent that works for my mom. Does she have to do something in order for me to file?

Will I owe money even claiming dependents?

Answer 1

YES , she has to give you a form 1099, that is the employers responsibility, if she doesn't give it to you by Jan. 31st, ask her for it, it's called a 1099, and from there you can do your tax return.

Answer 2

She should give you a 1099 if you aren't getting a W-2. Why not ask her?

Whether she gives you a 1099 or not, you are legally required to file a tax return showing your income. You need to keep your own records of what you are paid. You'll fill out a schedule C or C-EZ showing your income and any allowable expenses, a schedule SE to calculate your self-employment tax, and a form 1040 to calculate your total tax.

If you haven't made any quarterly estimated payments, there's nothing to get back. And if you made over $400 you will owe some tax. But if you are eligible for EIC, depending on your income and who the dependents are and how many you have, you might get an EIC larger than the tax you owe, so you might get a check when you file your return.

Answer 3

First how are you paid? Is it a commission directly from each insurance company or is it a check from your mom? Are you truly an agent who solicits business and writes the contracts?

Many insurance agents are classified as "statutory employees" and the person who pays them *must* issue a W-2 and withhold for Fica/MC (but not for income taxes).

For insurance agents, these rules apply if you are "A full-time life insurance sales agent whose principal business activity is selling life insurance or annuity contracts, or both, primarily for one life insurance company." and "The service contract states or implies that substantially all the services are to be performed personally by them; They do not have a substantial investment in the equipment and property used to perform the services (other than an investment in transportation facilities); The services are performed on a continuing basis for the same payer."

If you do not meet this definition, then the payer will give you a 1099-Misc. You would still report the income/expenses on a schedule C (just like a statutory employee), but you would be responsible for your own self-employment taxes. SE taxes are 15.3% of your net earnings which can be a huge shock at tax time. (Eg, you make $7000 and owe zero income tax, but owe $989 in SE tax.)

If you owe more than $1000 in taxes and continue this work next year, you need to start making estimated tax payments.

Additional INFO, having dependents can reduce your income tax, but will not affect any SE tax. Qualifying children can generate refundable credits such as EIC and additional child tax credit--and yes, this can be used to pay the SE tax. If it doesn't pay the entire bill, you can still owe.

Answer 4

Do you realize that you are being screwed? The reason employers do this is because they save a lot of money. First of all, it cost them to put you on the payroll (time and money). Secondly, they do not have to pay their portion of the taxes owed. This means that you have to pay the full amount of the taxes. You do not want to mess with the I.R.S. so at the minimum get a 1099 which will make your situation legal. Pay the taxes you owe and tell your Mom to either put you on the payroll or give you extra money to help pay for taxes.

Answer 5

they will give you a 1099, you will file just like you do with a w-2 but they did not take any taxes out so you might owe this year if that was the only job you had. You may not want to do your taxes yourself this year get a good CPA to help you with this cause you might have some write offs that will help,

Answer 6

The w-2 is the official document you will need. The last pay stub may not actually show your taxable income, because of health insurance or other pre-tax deductions. Also, the tax preparer business are not doing pay-stub loans this year; I believe the banks that issue the loans felt it was not worth the hassle.

Answer 7

my wife is self employed, we sell Ameriplan USA.. a benefits plan. She files an I-9 I believe. You need to do this if your mom is going to claim you as an employee.. If not its under the table and you dont have to file. Because if you file and you've made money but nothing has been taken out for taxes.. believe me Uncle Sam is gonna take his.. but its a good idea if you're planning on applying for loans in the near future because they're gonna want proof of employment and sometimes use this in replace of paychecks... you can typically find this form at the public library when you file.. great job lookin out for this now instead of waiting til april when everyone is running around.. might also be a good isea to see a tax consultant in the near futur because they are all kinds of tax breaks for self employ including write offs for office space, utilities, GAS, computer depriciation, marketing, etc...

Answer 8

If you're being paid under the table-in cash- you won't get a W2 because no income is being reported for you. You do not need to file a tax return.

Answer 9

See either needs to give you a W2 or a 1099. Unless she is paying you under the table.

Answer 10

You have to file on your own; contact the IRS to find out what you need to do. Pretty simple....just a pain in the neck : ]