My employer gave me 1099-misc for 2016 but I am not self-employed and do not own any business . TurboTax says IRS would treat it is as I am self-employed anyway- Is this true?

[jywddkk1314]

All of a sudden, I have to pay several thousand of self-employment tax - while I do not own any business.  That seems not making sense to me.

[AmandaR1]

Yes, form 1099-misc box 7 "nonemployee compensation" is treated as being self-employed for taxes.  You can spot this coming when there's no taxes being withheld from your paycheck. Your position should have some autonomy and independence of skill to qualify as self-employed. While you pay self-employment taxes, you also get to deduct all of your expenses. If you don't have any expenses, then you may not really be self-employed.

If it's not correct; meaning you truly are an employee, then you can file Form SS-8 Worker Determination and challenge your employers categorization. Instructions at IRS for qualifying for and completing the form, here: https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-o...

[leons8315]

So, does this answer mean "Yes" you have to pay self-employment tax?

[tooworried47]

I know that question is old, but for anyone else looking at this in 2020, that’s definitely what it means. Unfortunately, my husband has no way he can challenge his boss. She decided she doesn’t want to pay taxes anymore, so a few years back, she took him from a w-2 to a 1099. So, he is stuck paying a ton of money each year now.