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Old 05-05-2019, 07:48 PM
 
544 posts, read 525,177 times
Reputation: 581

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I just got hired for an early morning paper route and was told that as such, I am considered an independent contractor. They further said that whether I claim the income or not is up to me.
Is it true that I dont have to claim the income? They said if I did, the benefit would be I could write-off my car, fuel, supplies, and a few other things. Obviously, if I dont claim it, I don't pay tax on it.

So, is it legal not to claim it, and are the tax refunds I get back from the write-offs going to amount to more than the income tax? If the benefits are small to claiming it, I'd rather avoid hassle and not claim it

Someone pls advise which is the better option.
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Old 05-05-2019, 08:10 PM
 
3,412 posts, read 3,542,171 times
Reputation: 4856
Quote:
Originally Posted by MissmamaAnnie View Post
I just got hired for an early morning paper route and was told that as such, I am considered an independent contractor. They further said that whether I claim the income or not is up to me.
Is it true that I dont have to claim the income? They said if I did, the benefit would be I could write-off my car, fuel, supplies, and a few other things. Obviously, if I dont claim it, I don't pay tax on it.

So, is it legal not to claim it, and are the tax refunds I get back from the write-offs going to amount to more than the income tax? If the benefits are small to claiming it, I'd rather avoid hassle and not claim it

Someone pls advise which is the better option.
How much did you make?
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Old 05-05-2019, 08:16 PM
 
544 posts, read 525,177 times
Reputation: 581
Quote:
Originally Posted by usamathman View Post
How much did you make?
I just started and I will combining the income with another job, which will put me into a higher tax bracket at the end of the year
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Old 05-05-2019, 08:25 PM
 
Location: Madison, Alabama
3,568 posts, read 1,697,637 times
Reputation: 2794
Here's my understanding: You should always report all income. It's required by law, and if you don't that's one thing the IRS will jail you for. It's fraud; a simple mistake can be corrected, but fraud cannot.

If your employer actually told you it's optional to report the income, they are very wrong. You must already know that you have enough total income to be taxable, since you said it would put you in a higher tax bracket, so yeah, report it.

And of course, there's the honesty aspect.
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Old 05-05-2019, 08:31 PM
 
Location: Aurora Denveralis
8,576 posts, read 3,001,676 times
Reputation: 12765
Remember: the "next bracket" is marginal. It doesn't up your overall tax rate.
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Old 05-05-2019, 09:07 PM
 
Location: North State (California)
39,308 posts, read 2,966,634 times
Reputation: 12848
earned income is subject to taxation. You need to report it. I doubt the person who told you that reporting it is optional, knows what they are saying ( encouraging tax fraud ) However, many people work for cash under the table & they rarely get caught/
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Old 05-05-2019, 09:10 PM
 
Location: Western Washington
8,929 posts, read 8,390,690 times
Reputation: 15495
Legally you are required to report all income and pay taxes on it. Companies that contract with you on need to issue a 1099 if they pay you $600 or more in a calendar year.

Why would you take the job if the deductions are going to be more than you earn? That means you are doing the job at a loss. Why do that?
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Old 05-05-2019, 10:10 PM
 
Location: North State (California)
39,308 posts, read 2,966,634 times
Reputation: 12848
Quote:
Originally Posted by fishbrains View Post
Legally you are required to report all income and pay taxes on it. Companies that contract with you on need to issue a 1099 if they pay you $600 or more in a calendar year.

Why would you take the job if the deductions are going to be more than you earn? That means you are doing the job at a loss. Why do that?

OP did not say that.
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Old 05-06-2019, 03:46 AM
 
57 posts, read 14,504 times
Reputation: 72
Working as an independent contractor REQUIRES the entity or person who is contracting you, to issue you a Miscellaneous 1099(1099 MISC) for earnings $600 or more. HOWEVER, EVERY dollar earned is subject to income tax, whether you receive a 1099MISC or not, even if you earn $100 CASH. The person or entity that conveyed this is encouraging their clients to commit tax fraud. ALL INCOME is subject to income tax.
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Old 05-06-2019, 04:14 AM
 
Location: Ohio
175 posts, read 30,248 times
Reputation: 67
Quote:
Originally Posted by lovetotravel15
ALL INCOME is subject to income tax.
Not speaking of the OP's income now, but taxable income does not necessarily mean you are required to file.

Federal, if you make under 10,000.00 a given year, most probably you are not required to file. If you qualify for a refund, then file of course.

I live in Ohio, and the filing requirement is the same, under 10,000.00, you are not required to file.

Municipal taxes on income though, are locality specific.
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