For a commission hairstylist getting 60% and my 10-99 shows my total in the non employee compsation is that total just my 60% or the whole 100% that was brought in

[selenakstepp]

I was told by H&R Block I can write a deduction for the 40% I pay her to work there but I don't know if it's 40% of what's in box 7 or if I need to add the 40% to box 7 bc that would be a huge difference in numbers

[david-peek64 · Accepted solution]

The 1099 you received identifies what was paid to you.  If she pays you 60% of what was brought in then the number on your 1099 is the 60% you received.

[selenakstepp]

Ok so I need to figure out the 40% she kept to write as payment to work in the salon correct?

[david-peek64]

Sorry for the delay...didn't see this!  Correct.  40% you paid=((number on 1099) / 0.6) * 0.40

[marandamaeandrad]

I am in the same boat as you. So I can use 40% the salon keeps as a deduction because this would be what I pay to work there? Is that correct?

[Jewelzinaz]

I hate to be the bad guy here but…it is against the law to give a commission hairstylist a 1099.  The owner of your salon is committing tax evasion.  File a form SS-8 to have the IRS look at your classification.  If you work there and are on the payroll & receive a paycheck for services you performed on a regular basis you are an employee.  The 40% she keeps is not a rent payment.  Does the owner buy supplies? Tell you what to charge for your services or collect the money in a central location?  If so you are an employee.  Let the IRS decide if you are an employee.  If you are that salo ln owner owes you back taxes they should have paid on your behalf.  Please tax professionals don’t give out incorrect info.  If the stylist paid rent then she would give the owner a 1099.  Not the other way around.

[Veeholl05]

What if you are a commission only stylist, but not offered an hourly wage for when you don't have clients and not offered any kind of benefits or sick pay or PTO. You are also required to stay in the building without pay. Does that technically classify as an independent contractor? Or would you still be considered an employee? 

[Critter-3]

You are also required to stay in the building without pay. 

You do this because the salon needs coverage for walk ins  AND you agree to do this during certain hours (which may increase your income).  If you don't like the situation and the client will not treat you as an employee then your option is to leave and find a more suitable situation.  

[Veeholl05]

I thought they had to pay you to remain on the premises. 

[Veeholl05]

I was told I could work whenever I wanted, but that changed. My contract also says nothing about me working any specified hours. 

[Critter-3]

A  "client"  of a self employed  sub contractor cannot demand you do anything ... you and the client agree on a contract for a fee.  

So if you do not like the terms of the contract you have then fire this client and get others.  So if you don't like the situation find another   OR   turn the  "employer" into the IRS by filing the form SS8 if you believe you should be treated as an employee and not a contractor : 

https://www.irs.gov/taxtopics/tc762