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For 2018 tax year for the new laws that were just passed. I…

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Hi, I am Tax Planing for...
Hi,
I am Tax Planing for 2018 tax year for the new laws that were just passed. I am a General AREA Manager for two restaurants in Florida and I make over $75,000 a year as a W-2 wage earner. Is it better for me to create a management company and ask my employer to pay me as an independent contractor for this year since it seems that the Tax Cuts & Jobs Act is more favorable to small businesses and this way I can deduct the unreimbursed employee deductions that are going away in 2018 or stay as an employee? I also do consulting for their social media campaigns 3-4 times a year that could results in me receiving 1099's misc income, so I could do half and half also but not sure what is more advantageous for someone in my position?
Submitted: 1 month ago.Category: Tax
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Answered in 3 minutes by:
3/22/2018
Tax Professional: Barbara, Enrolled Agent replied 1 month ago
Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 5,801
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
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Welcome to Just Answer. My name is ***** ***** I will be happy to assist you.

Unfortunately, you cannot choose whether to be an employee or an independent contractor. The IRS has strict guidelines regarding each classification.

If you are an employee, you cannot request your employer to issue a 1099-MISC.

As to your consulting work for which you will receive 1099-MISC, that will be reported on Schedule C of your personal tax return and will qualify for the 20% pass through deduction implemented by the Tax Cuts and Jobs Act.

Please let me know if I can assist you further.

Thank you and best regards,

Barb

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Customer reply replied 1 month ago
Well my question is since I will be receiving this miscellaneous income for consulting work will it be worth it for me to create a management company to file as S- corp or stay the same? Do I qualify for these IRS guidelines?!
Tax Professional: Barbara, Enrolled Agent replied 1 month ago

As I mentioned,

"As to your consulting work for which you will receive 1099-MISC, that will be reported on Schedule C of your personal tax return and will qualify for the 20% pass through deduction implemented by the Tax Cuts and Jobs Act."

You do not need to create a company, LLC or S corporation to qualify for the 20% pass through deduction.

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Barbara
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Category: Tax
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