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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 11350
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I DID A JOB AND REMOLED A OFFICE . i DID NOT SIGN

Customer Question

i DID A JOB AND REMOLED A OFFICE FOR SOMEONE. i DID NOT SIGN AN #1099 FORM NOR DID i GIVE THEM MY SSN. BUT NOW ALMOST TWO YEARS LATER I GET A LETTER FROM IRS THAT SAYS I HAVE TO PAY TAXES OF $4,351.00. I WAS NOT TO HAVE TO PAY ANY TAX ON THIS BECAUSE I GAVE THIS TO THIS BUSINESS AT COST IN FACT I LOST MONEY. BUT THIS BUSINESS FROM WHAT I CAN TELL TURNED THIS IN TO THE IRS THAT THEY PAID ME $15,000. i WAS ASSUMED THAT IF I DID NOT SIGN A 1099 FORM NOR DID I GIVE THEM MY SSN# ***** THEY WOULD HAVE TO PAY THE TAX IF THEY TURNED IT IN TO THE IRS?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.
Hi,Please don't shoot the messsenger here, but (1) you DO have to report all income HOWEVER, (2) You can file a schedule C with your return for that year SHOWING that you had costs and lost money on the project ....The 1099 is what someone is REQIRED to send when they pay someone more than $600 in a year, so what probably happened here is they send the 1099 (should be a copy sent to you and a copy sent to IRS, and you didn't get your copy (just a guess, but IRS definitely got their copy..But again, there IS a right way to get out of this. I can help.
Expert:  Lane replied 1 year ago.
Hi,Please don't shoot the messsenger here, but (1) you DO have to report all income HOWEVER, (2) You can file a schedule C with your return for that year SHOWING that you had costs and lost money on the project ....The 1099 is what someone is REQIRED to send when they pay someone more than $600 in a year, so what probably happened here is they send the 1099 (should be a copy sent to you and a copy sent to IRS, and you didn't get your copy (just a guess, but IRS definitely got their copy)..But again, there IS a right way to get out of this. I can help.
Expert:  Lane replied 1 year ago.
Still with me?
Expert:  Lane replied 1 year ago.
OK still don't see coming into the chat, so I'll start by giving you some general information ....There's a schedule that (apologize if you already know this) an independent contractor - which is what ANYONE is that does a job or someone when not their employee - turns in with their tax return; Schedule C (Profit or loss from Business)..Here's the form: http://www.irs.gov/pub/irs-pdf/f1040sc.pdf.YOu report the money that was paid to you at the top, under gross receipts, but then also report your costs to do the job (or jobs for that year) and come down to a profit or loss at the bottom..Then this profit (OR LOSS) flows from there to line 12 of your tax return (Business Income or Loss) and if it's a loss reduces your other taxable income for the year ... and if that was your only income for the year, would (in your case) wipe out the tax owed, completely.
Expert:  Lane replied 1 year ago.
IRS ALWAYS asssumes that the income was all profit UNTIL you send in the return with the schedule C to show that this was a loss.
Expert:  Lane replied 1 year ago.
If you have any questions at all, please let me know..I'll also make what's called an additional services offer here, so that we can talk or email directly (without having to go through JustNAnswer) and I can help yuo get this filled out sen sent in if you like .Once filed there will be no tax, penalties or fees, based on what your said here, becasue the Scuedule C will show a loss..Hope this has helped..Lane.If this HAS helped, I would appreciate a positive rating (using the stars or smiley faces on your screen)… That’s the ONLY WAY I'll be credited for the work here, Thanks!

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