Tax Documents

[jlrbutterfly]

My son has been providing lawn services over the summer for our church.  He is not an employee of the church and does this by contract since the church does not have any employees.  I have 2 questions:

Do the church need to issue him a 1099?

What tax documents does my son need to use to report the income?

[NCperson]

@jlrbutterfly whether or not the Church issues a 1099, there is an obligation to report the income.

That stated, if the income was under $400, there is no need to complete an income tax return and report it. 

the tax documents are the sames ones you personally fill out : Form 1040. 

[jlrbutterfly]

He did make over $400, so that makes sense he needs to complete a 1040.

Our Church is a 501 (c) 3, and needs to know if it is required to issue him a 1099.  How do we determine if this needs to be done?

[Hal_Al]

See:  https://www.clergyfinancial.com/when-should-use-form-1099-nec/#:~:text=All%20businesses%20and%20orga....

But that's the church's concern.  Your son does not need a 1099 to report the income. 

The IRS considers undocumented cash income (no W-2 or 1099-NEC), for work performed, to be self employment income. You report the income from your own records. Enter at "Business Income & Expenses" and TurboTax (TT) will complete Schedule C for you and allow you to deduct any expenses associated with this income. You'll also have to pay self employment tax (social security & medicare tax) on any profits greater than $432.

You may have to upgrade to the Self Employment version of TT.

[xmasbaby0]

If they paid him $600 or more during the tax year, they should issue a 1099NEC to him for the amount he was paid.   But even without a document, he can report the income on his tax return.   It is self-employment income, for which he must pay Social Security and Medicare

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

https://ttlc.intuit.com/turbotax-support/en-us/help-article/form-1099-nec/1099-nec/L5qTsBiSe_US_en_U...

https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/...

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

If your self-employment income was only from cash, personal checks, credit card payments, or cryptocurrency 

Type Schedule C in the Search box and then select the Jump to link. This will take you to where you can enter any cash, personal checks, credit card payments, or cryptocurrency (Form 1099-K) related to your self-employment. You may first be asked some general questions about your business. After you answer them, you’ll be taken to the Let's get income for (your line of work) screen where you can enter this income as Additional Income.