Taxpayer asks:
To Whom it may concern,
I have a 1099 form that records that I made $600.50. I have a regular job that I have my W-2 with. Because the amount is $600.50, do I need to include it on my 2008 taxes?
If so, can you advise me how? Never have done this before.
Thanks.
Taxgirl says:
When you get paid, you’re responsible for including all of the income on your tax return, regardless of the amount.
On the business side, the business is required to issue a form 1099-MISC if your non-employee compensation is more than $600. If you make less than $600 and the business does not issue a form 1099-MISC, you’re still legally required to report the income on your return, form or no form.
On the “what are the chances that I’ll get in trouble?” side, when a company issues a form 1099 to IRS, they report the same to the IRS, just as they would a form W-2. If the IRS receives the form 1099 from the company, they’ll look to match it to your tax return when you file. If it’s not included, you should expect to get an additional assessment from the IRS after they nicely add it in for you, plus interest and possibly, penalties.
So, by all means, report that $600.50!
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
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Then there’s the question of where to report the income. It may be Schedule C income and subject to self employment tax.