DawnC
Employee Tax Expert

Get your taxes done using TurboTax

No, it is not normal, but it could be appropriate depending on the situation.   What kind of work do you do and what kind of tax documents do you receive?   Do you receive a W-2 and a Form 1099 that totals up to your total income?     

 

Most workers are classified as either an employee of someone else or self-employed.  Each status has its advantages and disadvantages. Self-employed individuals have the advantage of being able to deduct their expenses on a Form 1040, Schedule C, Profit or Loss from Business, as direct offsets to income.  However, they must pay the self-employment tax.

 

There is one category of workers—statutory employees—who can enjoy the best of both worlds.  They are like independent contractors but without substantial investment in the facilities used in the performance of services.  The determination of who qualifies as a statutory employee turns on the facts of the situation.   The link above explains in greater detail.

 

If you are not a statutory employee and your employer is erroneously paying you as an independent contractor, they could be shifting their payroll taxes to you, which is not appropriate.  The IRS does not allow employers to do this.     Firms and workers file Form SS-8 to request a determination of the status of a worker for purposes of federal employment taxes and income tax withholding.

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