Filing status

Forum|Forum|3 years ago
February 21, 2023
2 replies
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My son worked for a software company. He was considered a "day player", no regular schedule, no benefits, hourly pay, no sales. For this work he received a 1099-NEC. Later in the year he was hired on as a regular employee, salary, benefits, regular schedule. For this work he received a W-2. Does he need to file as an "independent contractor"? The 1099-NEC lists the money received as nonemployee compensation. He was not running a private business in any way.

Not A Product Question

xmasbaby0

Level 15

Yes----he has to use online Self-Employed or any version of the CD/download since for part of the year he was paid as an independent contractor. He might not feel like he had a business but the IRS looks at it that way, since he had no tax, Social Security or Medicare withheld from the income he received on a 1099NEC. His W-2 income needs to go on the same tax return.

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

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.**

MinhT1

Level 15

Yes. He must file as a self-employed person. He was also an employee for the latter part of the year and must also include his form W-2 on his tax return.

The following advice is for your son:

Income reported in box 1 of form 1099-NEC is self-employed income. You are considered as self-employed and in IRS terms, are operating a business doing what you do to earn the income reported on the form 1099-NEC. You enter your form 1099-NEC in TurboTax and TurboTax will populate a Schedule C after you enter all your information. You can deduct any expenses you paid related to this activity (such as supplies, car expenses, etc.)

Self-employed income is subject to income tax AND self-employment tax (calculated at 15.3% on 92.35% of net self-employed income).

You do not own a business in the common meaning of the word. So in TurboTax answer that you use the cash method, that you do not have an EIN. You use your own name as the business name and your personal address as the business address.

You’ll need to use TurboTax Deluxe (or TurboTax Self-Employed if you have expenses to deduct), or TurboTax Home and Business.

You can read this TurboTax article for more information.

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