When you get ready to file your taxes and you only have to
file taxes with form 1099-Misc, you need to know where to enter this income.
Besides knowing where to enter the information, you must know what other tax
obligations you have that pertain to the 1099-Misc form. If you are an
independent contractor who receives a 1099-Misc, you could be subject to self
employment taxes and may be able to claim expenses on Schedule C that pertain
to the business you conduct. Have
a question? Get an answer from tax advisor now!
Instructions
Schedule C Profit and Loss Form Business
1 - Start the Schedule C by filling in the top portion of
the form with your personal information. In Part 1, enter the income that you
have entered on the 1099-Misc. On line 7, total lines 1 through 6 to find your
gross income.
2 - Enter all expenses on lines 8 through 27 that apply. All
expenses must relate directly to the business that you preformed. For instance,
an artist may claim paints and studio rent if it is for work only. A writer may
claim fees for office supplies that pertain to the business.
3 - Total the expenses on line 28. Subtract line 28 from
line 7 (gross income) and enter that amount on line 29. Continue entering the
amounts you have on lines 30 through 32. If you have a profit or loss on line
31, enter this amount on line 2 of the Schedule SE and on line 12 of the 1040
form. Enter a loss in parentheses to indicate a negative amount.
Schedule SE Self Employment Tax
4 - Follow the chart on the Schedule SE to see if you must
file the short form or the long form. Most people will use the short form
unless their income is over $106,800 or if they are a member of a religious order,
such as a minister.
5 - Enter any profit or loss that you may have from a farm
profit (or loss) if this applies on line 1a. Complete line 1b if it applies. Lines
2 is already filled in with the total from the Schedule C. Add lines 1a, 1b and
2 together and enter this total on line 3.
6 - Multiply line 3 by .9235 and enter the total on line 4.
If the total is less than $400, you do not owe any self employment taxes. If
the total is more than $400, continue to line 5 and 6. Multiply line 4 by .153
if the total on line 4 is $106,800 or less and by .029 if line 4 is more than
$106,800. Enter the result on line 5 and on line 56 of form 1040. Divide the
total on line 5 in half and enter the result on line 27 of the 1040 form and
line 6 of the Schedule SE.
2013 Tax Extension forms
2013 Tax Extension forms
1040 Form
7 - Enter any other income you have to report on the 1040
form. This includes income such as taxable interest, W-2 forms, tax exempt
interest, capital gains or unemployment compensation.
8 - Complete the adjusted gross income on lines 23 through
and 37. Complete the taxes and credits on lines 38 through 55. Enter any other
taxes you have on lines 56 through 60 and any payments on lines 61 through 71.
If you made any estimated taxes during the tax year for the 1099-Misc income,
write this amount on line 62.
9 - Continue the return until you have completed lines 72
through 76 to determine if you will owe money or if you have a refund coming.
Sign and date the return. Send the Schedule C, Schedule SE, 1040 and all other
schedules and 1099-Misc forms, along with any W-2 forms, the Internal Revenue
Service address listed for your particular state.
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