I worked for a business that I do not own he paid me in cash. The sum is for this year and part of last is 7,225.
He gave me a 1099 Misc form. I paid no taxes on this money.
I thought I would be geting a W2 form.
I'm filing this with a on line tax with Turbo Tax..
I'm legally separated and have one qualifying child.They have me getting back a refund for EIC and Making Work Pay and Child Tax Credit.
It made me file as I owned this business so it listed me as a independent contractor.
It tells me I'm getting a refund of 2,223.
Now here is the sticky part comes in the business box it says 1,021. Do they cover that or do i have to pay they gave me standard of deduction of 8,400. They ran a error check and all was good.
I had a moderator reply and he said it was covered, but I'm still confused about this..Does anyone know if i get this refund the IRS will turn around and charge me for the 1,020?
How can I get a refund if it show the 1,020 on the business tax box called other taxes. This is the way it looks +1,021. Help anyone that knows please.
When you receive a 1099 you are seen by the IRS as a business owner and are responsible for paying self-employment tax (I'm guessing that's what the $1021 is for)
With the EIC, Child Tax Credit, and Making Work Pay credits, you are receiving a nice refund - however, the self-employment tax must be paid and is deducted from the total refund amount you would be receiving. Leaving you with a refund amount of $2223.
To check this, add the credits and subtract the self-employment tax from the total. Does it match the refund amount? (assuming, of course, there aren't any other additions/deductions)
(I don't have my tax forms yet, otherwise I would look at it to see specifically what you should look at)
Sorry, I didn't explain that very well.
The so-called 'self-employment' tax should be equal to (1/2 of? or at least no more than) the amount of taxes you'd have taken out of your paycheck through a traditional employer. I believe it goes to your Social Security account and would be why I think the amount would be half the amount from a traditional employer - a traditional employer has to contribute a matching amount to Social Security on your behalf.
I will go check this if it does not add up will take it to a pro to do.I'm a little spooked just read so many complaints about turbo tax.As a single Mom now it's to risky to leave to chance.I will report back and see if the numbers add up for me. Thanks for your input.
Where are you located? I would be happy to review the forms with you if you are close or if you can scan them in and email them to me. The amount of income you need to report is only that which you received during calendar year 2010. Any from 2009 should be on last year's tax return, and any from 2011 will go on next year's return.
I wouldn't give this information to anyone asking online - Not a good idea!
sorry - it's not even a good idea to be asking for it! doesn't sound safe to me.
I understand your position. Sometimes it is easier to provide solutions if you have a clear understanding of the situation. That is all I am suggesting. Anybody who receives a 1099-MISC and is not clear with the preparation of their taxes should work with a professional tax preparer, bookkeeper or CPA. In addition, anyone who is self employed must pay in quarterly estimates, and a professional can help calculate how much should be paid in on a quarterly basis. This is the case, even if the taxpayer anticipates a refund due to EITC or other tax credits.
I am in east central Ohio, and am willing to work with you if you desire my assistance.
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