Thought I was working under the table, but employer reported $5000 in wages. What should I do?

Question

He claims I was a private contractor, but that was not the original agreement.

Answer 1

working under the table is technically being a private contractor and therefore subjuct to a 1099 going to the IRS. Your contract was illegal and not valid. You will have to pay self employment taxes along with the rest of your taxes. Next year, try working for for someone honest, and be honest yourself, we all have to pay taxes and die.

Answer 2

I'm afraid getting paid under the table is illegal, so that voids your original agreement.

You first need to determine, without regard to the under the table deal, whether you are an employee or a contractor. Your status is again a matter of facts and circumstances; you and your employer cannot merely agree to be one or the other.

There are a series of factors the IRS looks at to determine employee or contractor status. The most important is who controls how the work is to be done. If its you, you are probably a contractor; if not, you are probably an employee.

If you are a contractor, you would file Schedule C with your 1040. It reports your income and expenses from business. If you have a profit of over $400, you also need to pay self-employment tax to pay into your social security account.

If you are an employee, your employer needs to issue a W-2. If he refuses to do so, there is set of procedures to follow.

Answer 3

There's no such thing as working under the table. Whether the payer reported the income or not, you were required to put it on your tax return.

The only issue is whether or not you were an employee (as you seem to think you were) and were supposed to cough up income taxes and 7.65% for fica/mc or an independent contractor (what his accountant is doing so he can deduct the money you were paid) and owe the other 7.65% as well.

As you should have realized in the beginning, you will owe money. If this is the only income you had, then your SE tax will be $706. Pay it by 4/15. (You can make a stink and file form ss-8 to make him pay half.)

Even if you had "an agreement" it's illegal and therefore unenforceable.

Answer 4

Reporting wages to the IRS, and paying the business business enterprise element of Social risk-free practices and employment taxes is the *employers* accountability. in the journey that your spouse has been incomes all 300 and sixty 5 days yet would not pay taxes on those earnings till after the tip of the 300 and sixty 5 days, she will have the means to stand a prior due value penalty, yet this is all. there is not any "offender" felony accountability till she intentionally fails to document earnings. i think that Cindy's subject isn't your spouse going to artwork for somebody else, yet her going and reporting the earnings - no longer paying an workers Social risk-free practices money, on an 'as-earned' foundation, IS against the regulation. whilst Cindy employed your spouse, develop into she 'at that element' legally allowed to artwork in the US? If no longer, then confident, your spouse broke the regulation by employing taking the activity, and it 'would desire to' have a detrimental effect on her immigration case. (even however if she now has an SSN and is married to US citizen it is not likely.) The fines for Cindy, however, for hiring an unlawful, would nicely be super. Richard

Answer 5

Prepare to pay income taxes and social security on those wages.

You might contact the Dept of Labor in your state. Depending on the type of job and your state laws, your employer may not be able to classify you as a contractor. Your employer would have to pick up part of the social security costs.

Answer 6

Well, I suppose you could call the IRS, tell them you thought you were going to be able to get away with tax fraud but now your dirty rat of a boss is doing things legally instead.

Or you could report the income and pay the taxes you owe.

Your choice.

Answer 7

You will be getting a 1099 and need to file a 1040 with Schedules C and SE. Or get a new identity. Nothing you can do but quit.