Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I own a residential cleaning service, and for 7 months last year, we provided services for a woman who owns a business.
Her business is an a different location a few miles away, we never cleaned her business, only her home....but she always paid me with her business checks.
I received an email from her this morning with a W9 attached, and she requested I fill it out.
She claims I provided services for her business since she has a home office (a 3'x6' desk in her guest room ).
From what I've read on the IRS website, that really doesn't qualify as a home office, since she doesn't see clients there...etc...so legally she can't claim my services.
Am I required to provide her this...I feel she is trying to deduct the cost of my services when she really isn't supposed to.
Yes, she is going to deduct your cleaning services as a business deduction.
Your tax liability will not change by filling out a W-9 and receive a 1099 from her business. (unless you did not intend to report the income)
Personally I would fill it out. You might "win" the argument but lose her future business. There is no liability on your part- you are not required to know if her home office qualifies as tax deductible or not.
Yes, she is going to deduct your cleaning services as a business deduction.
Your tax liability will not change by filling out a W-9 and receive a 1099 from her business. (unless you did not intend to report the income)
Personally I would fill it out. You might "win" the argument but lose her future business. There is no liability on your part- you are not required to know if her home office qualifies as tax deductible or not.
She isn't a client anymore, so I'm not worried about her business...I ended the service due to a change in the area we were covering.
I do report my earnings in a Schedule C...etc...every year.
My concern is that she is claiming my services as a business expense, and she doesn't run a business out of her home. Isn't that tax fraud?
I'm not worried about any backlash toward me, I make sure I do everything by the book.
Since she used her business checks to pay you I would probably just fill out the W9 and be done with it. Whether or not its tax fraud should be left to the Infernal Revenue Service to determine.
I work with small business accounting and see questionable expenses all the time. It is so common that I have a paragraph in my engagement letters stating I do not offer tax preparation or tax advice. (I deal with other areas of accounting- mostly with the systems and reporting)
The way I look at it is that "it's not my job". The clients don't pay me for tax advice and the IRS doesn't pay me to audit businesses. I do not care if the deductions are legitimate or not. I do what I am paid to do and move on.
There are new requirements for 1099 filing and they are cracking down on those who are not compliant. She is required to issue you a 1099 for the total payments made to you, even if only a portion of the services are a business expense.
It is also possible for a 3'x6' desk in a guest room to qualify as a home office so you don't need to feel complicit in a tax fraud scheme by filling out the form.
She can't make you provide the information but you might as well, since it will have no impact on your own tax liability.
I know. It seems more and more people are ignoring this rule.
Its because of confusion over "due to whom?"...
There are two parts of this, when you are supposed to send the 1099 to the person which is 31 January, but you have the fsomething or another due date in February for sending the 1099 reports to the IRS. many people who use the internet to reserach this will first come across the IRS publication about the reporting to them and the february date is plastered all over it. So they see the date the business sends the 1099 info to the irs and think its the date they have to send the 1099s to the person.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
