Yes, they are required to pay taxes on the income that they receive that you are paying them, however, you should not be paying your own personal taxes on that money as it should be deducted from your actual income.
You should issue the person you are paying a 1099 (if they are not considered an employee) or if they are an employee, then you should issue them a W-2. If you give them a W-2, then you would be responsible for payroll taxes as an employer and deducting their FICA taxes from their wages as well. The amount you pay them will then be deducted what you receive as part of your self employed expenses. You will then only pay your Medicare, Social Security and federal taxes on the amount you actually keep which is your net profit.
Taking Business Expense Deductions
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
