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1099 Tax
Hi,
I am working as a software engineer on W2 base. Also, I am doing a second job that is 1099 Misc basis. Last year on 1099, I paid a huge tax rate like 40%. So my question is how can I reduce the tax rate on second job. My friends advaced me to start a new company. Is it necessary to start a company for this or Just I can show my expense on second job like travel,laptop,dsl etc instead of starting a new company. Expecting your reply at the earliest. Thanks Biby Thoms |
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Biby Thoms:
As far as the IRS is concerned, you already started a business when you filed the Schedule C/C-EZ to claim your Form 1099-MISC income. You can claim the expenses you are talking about about (travel, transportation, laptop, DSL) on the Schedule C if they are legitimate business expenses you incurred while earning that Form 1099-MISC income. BTW, saying "Expecting your reply at the earliest" is an excellent way to get ignored on a board like this, especially when the people who have the answers are real busy (as we all are at this time of year)! I nearly passed on answering your question, but decided to cut you some slack. Don't let it happen again. |
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