Ask Experts Questions for FREE Help !
Ask
    clubTSI's Avatar
    clubTSI Posts: 2, Reputation: 1
    New Member
     
    #1

    Mar 7, 2007, 11:37 AM
    1099, my only source of income, where do I stand?
    I began doing a lot of free lance work for a local nightclub. A considerable amount. It was working out great, because I am still a student and the work fit my schedule great.

    Here's the problem. I never really looked into it and now I realize I'm looking at a hefty payment.

    Somebody told me that because my total income from the business was less than $10,000 from this company, I would have to pay the percentage but would then receive a refund.

    I have a W-2 from one other job, first half of the year. The 1099 with the current company covers August-December. $9,700 total.

    I have been keeping tabs on my expenses. And I know I need to switch over to W-2 as soon as possible.

    But in the mean time, what should I do as far as my 2006 taxes go?

    Thanks.
    ballengerb1's Avatar
    ballengerb1 Posts: 27,378, Reputation: 2280
    Home Repair & Remodeling Expert
     
    #2

    Mar 7, 2007, 11:50 AM
    Since this sounds "off the books" I doubt that you paid any tax on the $10,000 in advance as you should have. When you file you will owe. The IRS will expect quarterly payment of future free lance work or you will face a fine for paying late.
    clubTSI's Avatar
    clubTSI Posts: 2, Reputation: 1
    New Member
     
    #3

    Mar 7, 2007, 12:10 PM
    Quote Originally Posted by ballengerb1
    Since this sounds "off the books" I doubt that you paid any tax on the $10,000 in advance as you should have. When you file you will owe. The IRS will expect quarterly payment of future free lance work or you will face a fine for paying late.
    And as far as what I owe, am I looking at over 15%?
    ballengerb1's Avatar
    ballengerb1 Posts: 27,378, Reputation: 2280
    Home Repair & Remodeling Expert
     
    #4

    Mar 7, 2007, 12:13 PM
    I don't know what your w-2 says from the other job, were you paying taxes via withholding on that job. I'm thinking its going to be closer to 25% than 15%.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
     
    #5

    Mar 8, 2007, 12:40 PM
    ALCON:

    The self-employment tax on the 1099 income is 15.3%.

    The income taxes (state and federal) depends on all income plus which state you live in, but it could approach 35%.

    Total tax could be as high as 50%. :-(

Not your question? Ask your question View similar questions

 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

1099 MISC income [ 1 Answers ]

We have an employee who is exercise instructor who also did some painting in our facility for a flat fee. Is the painting income reportable on Form 1099 and if so which box?

1099 verses W2 income [ 1 Answers ]

Can I issue a current employee a 1099 for janitorial services? Or do I have to include theses monies in the W2 wages.

Foreign you.S. Source Income Subject to Witholding [ 1 Answers ]

Please can you help! I am a UK citizen. I recently received 'Form 1042-S - Foreign U.S. Source Income Subject to Withholding. It looks from the form as though Computershare, who hold my HP shares for me, have withheld 15% of the Gross Income from the dividends on my shares. I understand...

State taxes--source of income/residency [ 3 Answers ]

Hi So I was a student in NJ till last June (I'm still on F-1 from India), currently doing OPT in IL. I received a fellowship award to come work in IL for 11 months--the income was reported on 1099-MISC box 3. I'm filing as an independent contractor for my federal return. The non-profit that gave...

Source of income different from state of work and residence [ 1 Answers ]

I was in F1- OPT from feb 1 of 2005 and got employed by a firm in NJ and am working as a IT tech support for a client in Nashville ,TN. I have been living in TN for about an year now. I have been paying the federal tax (15%) and also the NJ state tax till date. From August I have transferred to an...


View more questions Search