1099 Forms: Everything You Need to Know
If you’re a student who has worked a part-time job or two during your college career, you’re probably familiar with the W-2 form. But what about the 1099 form? You may have received one of these after working a summer internship or part-time job and been wondering what it is and what you need to do with it. Keep reading to find out everything you need to know about 1099 forms.
What Is an IRS 1099 Form?
An IRS 1099 form is a tax document that reports income other than salary or wages. This includes income from freelance work, rent, interest, or dividends. The payer—in this case, your employer—is required to send you a 1099 form if they have paid you $600 or more during the year. You will then use this form to file your taxes.
If you have received a 1099 form, it’s important to note that you are considered an independent contractor rather than an employee by the IRS. This means that your employer does not withhold taxes from your paychecks, and you are responsible for paying taxes on the income earned from the job in question. You will also need to file a Schedule C form when filing your taxes in order to report this income.
How Do I File My Taxes if I Have Received a 1099 Form?
If you have received a 1099 form, you will need to file a Schedule C form along with your taxes in order to report your income. You can find Schedule C forms online or at most tax preparation software companies. Be sure to keep good records of the money you have earned and spent related to your job in order to avoid any penalties or fees associated with underreporting your income.
Receiving a 1099 form can be confusing, but it doesn’t have to be if you know what it is and what it’s for. An IRS 1099 form is simply a tax document that reports income from sources other than salary or wages—think freelance work, rent, interest, or dividends. The payer—in this case, your employer—is required to send you a 1099 form if they have paid you $600 or more during the year, at which point you will use the form to file your taxes. Keep in mind that if you receive a 1099 form, you are considered an independent contractor by the IRS—which means your employer does not withhold taxes from your paychecks and instead you are responsible for paying taxes on the income earned from the job in question come tax season. So long as you keep good records and file a Schedule C form along with your taxes,you should be all set.