California 1099-NEC

[HydroSci]

If the Payee made 650 in 2024, IRS does not require a 1099-NEC.  Do I have to file one for CA?

[DawnC]

You have to report all of your income, even if you did not receive a 1099 for the services you provided.    The IRS does not require 1099s be sent out if the amount is less than $600, but you have to report the income whether you received a 1099 or not. 

If you did the work in CA, then you will have to file a CA return and include the income.    However, if you did the work in your resident state (not CA), you only need to file in your resident state.   It does not matter where the company who paid you or your client is located.  What matters is WHERE you did the work.  

How does working remotely affect my state taxes? 

[HydroSci]

Thank you.  I know that you pay taxes regardless of whether or not you receive a 1099.  I am the payer and I want to know if California is following the IRS guidelines (>=$1,000) for issuing 1099-NEC, or are they requiring that one be issued at a lesser amount, e.g., $600.  I cannot find current information.  I do not have to file a Federal, therefore Calif will not automatically know the amount.

[VolvoGirl · Accepted solution]

Where do you see federal 1099NEC for greater than 1,000?    It's $600 for federal. 

See IRS 1040 Schedule C instructions page 7 for needing to issue a 1099NEC for over $600
https://www.irs.gov/pub/irs-pdf/i1099mec.pdf

And you must report any self employment income or cash etc. for over $400.  The calculation for Self Employment tax works out to be on $433.

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit (If it is greater than $400). The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare (FICA). So you get social security credit for it when you retire. It is in addition to any regular income tax you owe on it.

IRS 1040 Schedule SE instructions
https://www.irs.gov/pub/irs-pdf/i1040sse.pdf