1099 independent contractor rent deduction

[copenhagen1024]

Hello,

I am a 1099 independent contractor and my office rent expense is automatically deducted by my employer from my pay. I was told that the 1099 I will receive for 2023 will have the rent expense automatically deducted in the total amount and that I shouldn't deduct the rent expense on my taxes.

Is this acceptable? This sounds awfully shady and I just want to make sure the is allowed.

[Bsch4477]

You certainly shouldn’t deduct rent expense if it has already been accounted for. What seems shady is that you refer to an employer If you are an employee you should receive a W-2 and not have to file as self employed and so have to pay self employment tax. 

[copenhagen1024]

So automatically deducting rent expense by the company that is contracting me (sorry to mention employer in original post) and not allowing me to deduct it on my taxes as rent expense is an acceptable practice? Just want to confirm.

[JohnB5677 · Accepted solution]

Yes,  If your rent was not included in the income reported on the 1099, you will not deduct it!

If your 1099 was for the full amount, including the rent, you would be able to deduct it.  

The net tax result is exactly the same.

For example: You actually earned $52,000

1099 with $12,000 rent deducted:

• 1099 shows $30,000
• Taxable amount is $30,000

1099 with rent included.

• 1099 shows $52,000
• Rent deduction of $12,000
• Taxable amount is $30,000