Get your taxes done using TurboTax
You must have bank deposits for the times she paid you. Many times "employees" are paid cash. This is not unusual. You can file a Schedule C and report it as cash. You also have the option of reporting her and saving yourself half of the SE tax. See the bottom after the screenshot.
To set up your business:
- Open or continue your return.
- Search for schedule c and click the Jump to link in the search results.
- Answer Yes to Did you have any self-employment income or expenses?
- If you've already entered self-employment work and need to enter more, select Add another line of work.
- Follow the onscreen instructions.
However, the only way around this, is to file a Form 8919. The qualifications and instructions are available in the link below.
Workers who believe they have been improperly classified as independent contractors by an employer can use Form 8919, Uncollected Social Security and Medicare Tax on Wages to figure and report the employee’s share of uncollected Social Security and Medicare taxes due on their compensation. See the full article Misclassified Workers to File New Social Security Tax Form for more information
If you are, indeed, self-employed, you will need to file a Schedule C. Schedule C, Profit or Loss from Business is an IRS form filed by sole proprietors and other self-employed taxpayers.
It tallies up the business's income and expenses, and the net income (or loss) flows from Schedule C to Form 1040, Line 12.
TurboTax automatically creates Schedule C (or Schedule C-EZ) when you enter your business information or when you enter what the IRS considers self-employment income, which is often reported on Form 1099-MISC.
