My employer changed the way he is paying my LLC

Forum|Forum|2 years ago
October 4, 2023
3 replies
26 views

Hello,

I have created a new LLC during the year of 2023. I work as a consultant. My employer was paying my LLC through a software called Gusto showing his own LLC company.

Now he decided to stop using Gusto and started paying my LLC directly from his personal bank account.

Is that a problem for me when I file my taxation on April 2024?

VolvoGirl

Level 15

No, however someone pay you doesn't matter. Are you a Single Member LLC and file schedule C in your personal tax return? Does he give you a 1099NEC for it? The total he paid you should be on the 1099NEC or maybe two 1099s. But you need to keep track of your own income.

Actually you can just enter it as Other self employment income or as Cash or General income. You don't need to get a 1099NEC or 1099K. Even if you did you can enter all your income as Cash. Only the total goes to schedule C. You should be entering the income from your own records.

By the way if he is paying you as an Independent Contractor with a 1099NEC he is not your employer but your client or customer.

Alt2022Author

Level 2

yes , I am a single owner LLC and file joint personal tax return with my spouse. So which forms the employer should give me by the end of the year ?

VolvoGirl

Level 15

If he paid you $600 or more he might give you a 1099NEC. But since you are a LLC he might not have to give you any form at all.

You will need to keep good records. You may get a 1099NEC or 1099K at the end of the year if someone pays you more than $600 but you need to report all your income no matter how small. You might want to use Quicken or QuickBooks to keep track of your income and expenses.

Are you new to self employment? Is this the first year you will be reporting it?

Alt2022Author

Level 2

yes, thats the first year to use Turbotax as I just created the LLC. the income is higher than 600 usd as the payment is covering periods from April till Dec 2023

xmasbaby0

Level 15

If you are a consultant, you are not an employee. You are an independent contractor. You will be preparing a return using either online Self-Employed software or any version of the CD/download. You will be paying self-employment tax for Social Security and Medicare as well as ordinary income tax. The business you are consulting for should issue a 1099NEC to you if they paid you more than $600 in 2023.

https://ttlc.intuit.com/questions/2926899-how-does-my-side-job-affect-my-taxes

https://ttlc.intuit.com/turbotax-support/en-us/help-article/form-1099-nec/1099-nec/L5qTsBiSe_US_en_US

https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/26653

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

https://turbotax.intuit.com/tax-tools/calculators/self-employed/

**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.**