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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15184
Experience:  15years with H & R Block. Divisional leader, Instructor
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I own a corporation in State. I have a contractor who is

Customer Question

Hello. I own a corporation in Washington State. I have a contractor who is Mexican AND also a U.S. Citizen. However, she lives in Mexico. She does the work in Mexico. SO, I classify her as a contractor, NOT an employee. I pay her by the item that she produces.
What kind of form do I need to fill out, so I do not get caught having to pay taxes on her and having her classified as an employee?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.


As the person is a US citizen you would still be under the same reporting rules as you are for any other providers of services.

You get her to complete a W9 and if you pay her more than $600 you complete a 1099MISC.

On her part, as she is not in the US doing this work she can claim exclusions on the income for US purposes.

What you complete is a 1099MISC but make certain you get the W9 from her to keep on file.

Customer: replied 1 year ago.
Thank you for your information. A couple of follow up questions. The W-9 form has City, State, Zip code on it. She resides in Mexico. She does not have a U.S. address. Just wanted to confirm that form is still correct.Also, am I responsible for her filing taxes? She's probably never filed taxes in her life, as she has lived in Mexico most of her life. She will probably ask me about that. Is there a certain amount where she doesn't have to file taxes. Will I get in trouble if I report a 1099MISC and she does not do anything about her taxes?
Expert:  Robin D. replied 1 year ago.

That is still the correct form.

You are not responsible for her tax filing obligation. You are responsible for your filing of the information form 1099MISC.

If she does not file her own return and take advantage of the foreign earned income exclusion then she is responsible for that.

There is a certain income level where one does not need to file but all US Citizens even if outside the US have to report income and then they use exclusions or credits to not pay tax in both countries.

After you view my response, please post if you need more information or if you need no further clarification a positive rating is appreciated.
I know rating takes an additional step and I truly appreciate it when you take the extra time!

Expert:  Robin D. replied 1 year ago.

Please advise if you need more information

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