Why does the amount of my tax return significantly drop due to 1099?
I feel as though I have been duped. I was hired by an organization after agreeing on an hourly wage. Subsequent to my first pay check I was informed that the company was going to be starting "payroll", and until that time I would be considered a consultant, or outside contractor. I did not fully understand this, yet it seemed wrong. I began looking for different job. In the month I was employed I made roughly 5000.00. Towards the end of that month I was informed that I would be receiving a 1099.
I am aghast at the significant hit I have taken on my taxes. My return without the 1099 was roughly 6700. :) When I figure the 1099 it drops to 4900, or thereabouts. :mad::confused:
What am I doing wrong?
Is this legal?
There has to be something that I have figured incorrectly, to lose most of my EIC, and child tax credits...
Does anyone have any advice?