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I work for my husband

I do all of my husbands finances/billing/etc for his business.  He is an independent contractor.  I feel I should be paid something.  If he pays me a flat annual fee can he write this off?  I currently do not have an income so would this be tax adventagious to us both given we file jointly or not?

 

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3 Replies
Jackstar221
Employee Tax Expert

I work for my husband

I suggest that your husband pays you through a W-2, or through a 1099-NEC, that way he is paying taxes on those wages. Any payments $600 or more should go on a 1099-NEC, or a W-2.

 

Your husband can write off those wages paid to you on his business, but any wages or contract labor $600 or more should be reported on 1099's, you may get a letter from the IRS if wages are paid and deducted, with no 1099's issued.

 

Filing jointly is usually always better than separately for better tax credits & better standard deductions. It would be advantageous to write off the wages, but the 1099's would need to be issued, and the 1099's and/or W-2's you receive should be reported on the tax return.

drc845443
Employee Tax Expert

I work for my husband

I don't have the specifics but in general, it should not make a difference because if he pays you a fee, he will claim a deduction for the amount that he pays you.

However, you would then declare the amount as income on the same tax return which will offset the deduction resulting in no difference in your taxable income.

 

There may be an impact on self-employment taxes depending on the level of income and the amount of the payment, but for that I would need more specifics about your situation before I can comment. 

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Jackstar221
Employee Tax Expert

I work for my husband

The deduction for wages paid would be entered in the self-employment income section of TurboTax, if it is indeed a sole proprietorship.

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