[noula]

I am an F-1 student and interested in becoming an independent distributor for a nutritional company. I would get paid a commission per product I sell (though an online web store) for them and get paid through a tool similar to paypal.

Is that legal? Would it put me out of status? What information IRS need to know about this?how do I pay taxes out of my commissions?

Thanks,
Noula

[AtlantaTaxExpert]

Noula:

You are effectively setting up a business, because you WILL be paid under Form 1099-MISC and will have to file a Schedule C with Form 1040NR.

This WILL violate the provisions of your F-1 visa, which allows you to work ONLY as an employee to help pay your educational costs or as part of your field of study under Curriculum Practical Training (CPT) or Optional Practical Training (OPT).

Now, the IRS DOES NOT ENFORCE the provisions of your visa. That falls under the auspices of the U.S. Customs and Immigration Service (USCIS). All the IRS will do is enforce the tax laws, which means that if you DO become an independent distributor, you will have to account for the money earned on a Schedule C.

If the USCIS finds out about your job (BTW, the IRS will NOT tell the USCIS about the Schedule C income unless specifically asked), they will NOT be happy and will probably send you a letter telling you that you are in violation of your visa and to cease-and-desist.

More than likely, the USCIS would find out when you file for a green card, because then the IRS and the USCIS DO coordinate and review your tax records to verify that you paid all the taxes that are required.

BOTTOM LINE: Working as an indepdent contractor in themanner you listed is NOT ALLOWED, but it is, at worse, a minor violation of your visa.