Disappointed
Recycles dryer sheets
- Joined
- Sep 16, 2007
- Messages
- 464
I received a 1099Misc in the amount of $237,000 (box 7), according to the IRS, I am self-employed but I am not in trade or business as it is not a regular and continuous activity (see below).
1099-MISC, Independent Contractors, and Self-Employed
Question: I received a Form 1099-MISC instead of a Form W-2. I'm not self-employed and do not have a business. How do I report this income?
Answer:
If payment for services you provided is listed in box 7 of Form 1099-MISC (.pdf), Miscellaneous Income, the payer is treating you as a self-employed worker, also referred to as an independent contractor.
Am I qualified to contribute to any IRA? The only IRA I have is the rollover IRA. I read another publication regarding earned income but don't quite understand it.
mp
1099-MISC, Independent Contractors, and Self-Employed
Question: I received a Form 1099-MISC instead of a Form W-2. I'm not self-employed and do not have a business. How do I report this income?
Answer:
If payment for services you provided is listed in box 7 of Form 1099-MISC (.pdf), Miscellaneous Income, the payer is treating you as a self-employed worker, also referred to as an independent contractor.
- You do not necessarily have to have a business for payments for your services to be reported on Form 1099-MISC. You may simply perform services as a non-employee.
- The payer has determined that an employer-employee relationship does not exist in your case.
- If you are in a self-employed trade or business, you must include payments for your services on Schedule C (Form 1040) (.pdf), Profit or Loss From Business (Sole Proprietorship), or Schedule C-EZ (Form 1040) (.pdf), Net Profit From Business.
- If you are self-employed, you will also need to complete Schedule SE (Form 1040) (.pdf), Self-Employment Tax, and pay self-employment tax on your net earnings from self-employment of $400 or more.
- There is no withholding of tax from self-employment income. As a self-employed individual, you may need to make estimated tax payments during the year to cover your tax liabilities.
- If you are not an employee of the payer, and you are not in a self-employed trade or business, you should report the income on line 21 of Form 1040 (.pdf), U.S. Individual Income Tax Return, and any expenses on Schedule A (Form 1040) (.pdf), Itemized Deductions.
Am I qualified to contribute to any IRA? The only IRA I have is the rollover IRA. I read another publication regarding earned income but don't quite understand it.
mp