northexpo
New Member

w2

I am a contactor and the house that I am working on the guy has been paying me from his restaurant, he wants me to fill out a W2 but my concern is can I still write off all of my receipts if I fill out that W2, because wouldn't then I become his employee then and loss those

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W-2 employees cannot use job-related expenses as a deduction on a federal return.   But if you are a W-2 employee then the employer has to pay the employer half of Social Security and Medicare and withhold federal and state tax.

 

You would not "fill out" a W-2.   If he wants to pay you as an employee you fill out a W-4 to indicate how you want your tax withheld.

 

https://ttlc.intuit.com/community/tax-topics/help/what-to-know-about-the-new-2020-irs-form-w-4-emplo...

 

https://www.irs.gov/pub/irs-pdf/fw4.pdf

 

https://www.irs.gov/individuals/tax-withholding-estimator

 

 

What receipts are you referring to?   Who has been paying for the construction materials and supplies?   You need to have a very clear understanding about those expenses with the homeowner.  

 

If you continue to work as an independent contractor you can put your expenses on a Schedule C.

 

https://ttlc.intuit.com/questions/2584365-am-i-an-employee-or-an-independent-contractor

 

https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/...

 

https://ttlc.intuit.com/community/self-employed/help/what-is-the-self-employment-tax/00/25922

 

https://ttlc.intuit.com/questions/2902389-why-am-i-paying-self-employment-tax

https://ttlc.intuit.com/questions/1901340-where-do-i-enter-schedule-c

 

 

https://ttlc.intuit.com/questions/3398950-what-self-employed-expenses-can-i-deduct

 

 

https://ttlc.intuit.com/questions/1901110-do-i-need-to-make-estimated-tax-payments-to-the-irs

 

 

 

 

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

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Just to add--- did he ask you to fill out a W-9?   On a W-9 you enter your Social Security number or Tax ID so that he can issue a 1099NEC to you as an independent contractor, and he can report what he paid to you to the IRS.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
northexpo
New Member

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I buy the materials for the job and they reimburse me for them, I have never had this happen before and they never brought it up until now

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Does he want you to fill out a W4 or a W9?  The W2 is what employers give out at the end of the year to report the wages paid and deductions to the IRS.

 

The W4 is to report your ssn and how much withholding to take out of your pay.   Is he or will he be taking taxes out?  Then you are an employee.

 

A W9 is for independent contractors to give their ssn or EIN to the payer.  Then you would get a 1099NEC at the end of the year and report it on Schedule C for self employment income.

 

Seems like it would be too much work and cost for him to pay you as an employee.  Most employers would rather pay people as contractors with a 1099NEC not a W2.  

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So this is for the upcoming tax year?   The tax return you would prepare and file for 2022 in 2023?   Sounds like you need a very clear plan and understanding of how much you would be paid.   Would you be paid by the hour?   Have you crunched the numbers to see which way is better for you?   Is this the first time you have done this type of work?  Or have you been an independent contractor before now?   

 

 

Or is the homeowner trying to change the way you do things mid-job?   Did you work on this project in 2021?   Have you received a 1099NEC for 2021?  Or is the homeowner springing this on you for 2021 and trying to treat you as an employee for 2021?   

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
AmyC
Expert Alumni

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The IRS has strict rules on contractor or employee. If you are an employee, he has to pay half the Social Security and Medicare tax on the income and you would lose the ability to write off receipts. Please see Topic No. 762 Independent Contractor vs. Employee - Internal Revenue Service. to determine which is correct for your situation and share it with the person paying you.

 

If you were given a job to do and you determine how, when, and who works on it, provide  your own supplies, you are a contractor and should receive 1099-NEC. The guy still writes it off as labor and you still get to write off your expenses.

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