W2 instead of 1099

[eliassonsr]

I do side work as an instructor. 3/4 of the money is 1099 from other companies. One company will only pay me as a w2 (to avoid the issues associated with 1099's per accountant). 

Right now the only way I see to do this is a s follows;

1) Enter the w2 info as employment income.

2) 1099 income as business income (expenses will be entered that is related to those specific co.) 

I would lose out on specific deductions related directly to the company that issues the W2

Is there a way to blend this into my 1099 business or am I just out of luck? 

[xmasbaby0 · Accepted solution]

You can enter business expenses on a Schedule C for your self-employment income.  You CANNOT enter "job-related" expenses for a W-2 job---so yes, in that sense, you are "out of luck" for that.   Job-related expenses have not been deductible on a federal return for W-2 employment since 2017.

W-2 employees cannot deduct job-related expenses on a federal return.  Job-related expenses were eliminated as a federal deduction for W-2 employees by the tax laws that changed for 2018 and beyond.  Your state tax laws might be different in AL, AR, CA, HI, MN, NY or PA.

If you live in a state that lets you deduct job-related expenses, the information will flow from your federal return  to the state return, so enter it in Federal>Deductions and Credits>Employment Expenses>Job-Related Expenses

https://ttlc.intuit.com/questions/4482873-which-federal-tax-deductions-have-been-suspended-by-tax-re...

ALL of your income, including the W-2 income and the self-employment income, goes on the SAME Form 1040.   Your W-2 should show the federal and state tax withheld, and the Social Security and Medicare that was withheld.   For your self-employment income, you will be paying self-employment tax for Social Security and Medicare, as well as ordinary income tax.

If you use online TurboTax, you will need Premium.   If you use the CD/download, you can use any version of the software.  All versions of desktop software can handle W-2 income combined with self-employment income, and can prepare the Schedule C that you will need.

[rjs · Accepted solution]

There is no way to "blend" the W-2 income into your business. For the company that is paying you as an employee, you are an employee and the company is your employer. The job where you are an employee has no connection with your business. What you see as the only way to do it is, in fact, the only way to do it. You could ask the employer if they will reimburse you for expenses.

[eliassonsr]

Thank You