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Level 2
March 19, 2025
Question

Booth renter vs independent contractor

  • March 19, 2025
  • 1 reply
  • 0 views

I have a client who is a start-up esthetician beauty consultant in 2024. They rented space as an independent contractor, had their clientele, marketed themselves, established their sales license as a DBA, and made their hours. All transactions and payments received from services and products sold were funneled through the shop owner's scheduler and POS system. My client was set up as a provider for the POS system, not an administrator, all payments received were under the shop owner's name.  Does the shop owner provide my client with a 1099-NEC?

1 reply

Level 15
March 19, 2025

The taxpayer should maintain a record of of their sales separate and apart from whatever the shop owner may report.

 

Instructions for IRS form 1099-NEC, page 7, states:

 

Specific Instructions for Form 1099-NEC 

 

File Form 1099-NEC, Nonemployee Compensation, for each person in the course of your business to whom you have paid the following during the year. 

 

• At least $600 in: 1. Services performed by someone who is not your employee (including parts and materials) (box 1);

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