Solved: I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?
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I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?

 
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Level 15

I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?

Yes, the self-employed on line product is needed to deduct the expenses related to the Real Estate activity.  

Taking these expenses, not only reduces the income tax you would pay on the 1099Misc, but also the Self-Employment tax, as both are paid on the net profit.

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Level 15

I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?

Yes, the self-employed on line product is needed to deduct the expenses related to the Real Estate activity.  

Taking these expenses, not only reduces the income tax you would pay on the 1099Misc, but also the Self-Employment tax, as both are paid on the net profit.

View solution in original post

Returning Member

I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?

I am doing the same this year and will be my first time to be part time self employed in real-estate.  I have a lot of expenses going out while trying to get established while working my full time job. Is Turbo tax setup to easily walk me through filing with a W2 and 1099 along with a large amount of receipts/expenses ?? Is there a tool or application that I can use going into 2021 that helps manage receipts and expenses associated to the real estate side that will feed into Turbo tax?? 

Thanks

Level 15

I am a Full Time W2 employee and work part time in real estate. I have 1099 income and some expenses. Should I use the self employed tax forms?

If you are new to being self employed, are not incorporated or in a partnership  and  are acting as your own bookkeeper and tax preparer you need to get educated ....  

If you have net self employment income of $400 or more you have to file a schedule C in your personal 1040 return for self employment business income. You may get a 1099-Misc for some of your income but you need to report all your income.  So you need to keep your own good records. Here is some reading material……

IRS information on Self Employment….
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center 

Publication 334, Tax Guide for Small Business
http://www.irs.gov/pub/irs-pdf/p334.pdf 

Publication 535 Business Expenses
http://www.irs.gov/pub/irs-pdf/p535.pdf 

 

Publication 463 Travel, Gift, and Car Expenses

Https://www.irs.gov/pub/irs-pdf/p463.pdf  

 

Home Office Expenses … Business Use of the Home

https://www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction

https://www.irs.gov/pub/irs-pdf/p587.pdf

 

Publication 946 … Depreciation

https://www.irs.gov/pub/irs-pdf/p946.pdf

                                              

There is also QuickBooks Self Employment bundle you can check out which includes one Turbo Tax Self Employed return and will help you keep up in your bookkeeping all year along with calculating the estimated payments needed ....
http://quickbooks.intuit.com/self-employed


Self Employment tax (Scheduled SE) is generated if a person has $400 or more of net profit from self-employment on Schedule C.  You pay 15.3% for 2017 SE tax on 92.35% of your Net Profit greater than $400.  The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare.  So you get social security credit for it when you retire.  You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040.  The SE tax is already included in your tax due or reduced your refund.  It is on the 1040 line 57.  The SE tax is in addition to your regular income tax on the net profit.
 


PAYING ESTIMATES
For SE self employment tax - if you have a net profit (after expenses) of $400 or more you will pay 15.3% for 2017  SE Tax on 92.35% of your net profit in addition to your regular income tax on it. So if you have other income like W2 income your extra business income might put you into a higher tax bracket.

You must make quarterly estimated tax payments for the current tax year (or next year) if both of the following apply:
- 1. You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits. 
 
- 2. You expect your withholding and credits to be less than the smaller of: 
    90% of the tax to be shown on your current year’s tax return, or 
  100% of the tax shown on your prior year’s tax return. (Your prior year tax return must cover all 12 months.)

To prepare estimates for next year, You can just type W4 in the search box at the top of your return , click on Find. Then Click on Jump To and it will take you to the estimated tax payments section. Say no to changing your W-4 and the next screen will start the estimated taxes section.

OR Go to….
Federal Taxes or Personal (H&B version)
Other Tax Situations
Other Tax Forms
Form W-4 and Estimated Taxes - Click the Start or Update button

 

How does my side job affect my taxes?

You’re considered self-employed—even if it’s just something you do on the side, like drive for Uber, babysit, or blog.

Your taxes are handled differently than when you’re an employee of a company.

As a self-employed individual you:

  • will pay self-employment tax (because income tax and Social Security aren’t deducted from your pay)
  • will get a 1099-MISC or 1099-K (unless you only accept cash or personal checks)
  • file a Schedule C, Form 1040 (this is how you report business expense or loss of income)
  • can deduct money you spent on work-related expenses (like mileage, home office expenses, and cell phone use)
  • can estimate the taxes that are due and make quarterly estimated tax payments during the year

Get started by entering your income from self-employment. We’ll handle the rest, from creating the forms you need to reviewing work-related expenses that can help reduce your taxes.

 

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