employer's reason for making me a 1099 is because I gave them my availability and they scheduled me based on that. I dont think that is valid but this job (medical assistant) is important experience as a stepping stone towards my career goals so I cannot just quit. I do not want to ruin relationship with my employer as well by complaining or filing a form.
How do I file my taxes? I am 19 and I file my taxes alone. My first paycheck was 750 and I put 250 of that aside so I can use it to pay for taxes later on.
As a 1099 employee, am I paying quarterly taxes?? I've only ever been a W-2 employee. What percentage of my paycheck should I be setting aside for taxes?
I assume I have no deductibles because I'm working basically as a W-2 employee but I just have to pay more taxes since they want to save money and make me a 1099..
EDIT:
Thanks to everyone who have brought how serious this is to my attention. Since I am being classified as a 1099, I have decided I will look for another job as I am still working this one and quit when I find a new one. I will file a report to the IRS after I can safely secure a new job.
Forced to be a 1099 employee, how should I do my taxes?
byu/Left_Committee_6424 inpersonalfinance
Posted by Left_Committee_6424
28 Comments
contractor or employee? https://reddit.com/r/personalfinance/comments/bwwbxu/theres_no_such_thing_as_a_1099_employee_if_your/
Small biz tax guide: https://www.thebalancemoney.com/your-complete-small-business-income-tax-guide-399005
Sounds like misclassification to me, but if you don’t want to report your employer (and possibly protect future employees), then review the Self Employment section of the PF Wiki for the answers to your questions.
* https://www.reddit.com/r/personalfinance/wiki/self_employment
Can you choose to not work that schedule if you don’t want to? Sounds like your employer is skirting tax law. Find a new job. You’re not a 1099.
To answer your direct question, use Schedule C and Schedule SE for your federal individual income tax return and follow the instructions to attach them to your Form 1040. I’ve been required to file Schedule SE for most of my adult life, ever since I was in college.
There are advanced to being a 1099, and it’s grey area here because it sounds like you don’t use your own tools. But as a 1099 the employer can’t set your schedule which is why they put you on this. As an 1099, you might need insurance since you are now doing contract work. I would check into getting an llc, and yourself up as a business. You will be able to write off (which just means you don’t pay taxes on what you spend for your business) expenses like insurance, transportation, new tools, etc. 1099 is advantage for the employer becuase they don’t have payroll taxes, insurance, or benefits that they have to cover. It’s also your advantage because you control the work not them, and technically you’re never “fired.”
If you are scheduled to work that typically disqualifies you for 1099. Go look at the rules for 1099, likely you do not qualify.
you do not have an employer if you are a 1099 worker, you have clients, you have no employee rights through the company you are a freelancer
They do not have the ability to arbitrarily classify you as a 1099. You need to report this to the IRS, they are trying to get out of payroll taxes, this is illegal.
You are either a w2 or 1099 by *multiple* definitions. “Scheduled according to availability” is not one of them, or every college student and people with 2 jobs would be 1099.
This is gross misclassification with the intent to skirt taxes. Please report them. How many other people is this happening to?
The IRS has a whistleblower program.
There is information [here.](https://kkc.com/frequently-asked-questions/report-employee-misclassification-irs-whistleblower-program/)
Contact your state department of labor. This employer is trying to avoid paying taxes and you need to report them.
I’d be most worried about liability insurance as a medical assistant. As a 1099 you are likely not covered under theirs.
You are not a 1099 employee and what they are doing is 100% illegal
File Forms 8919 and SS8 with the service they should send you a determination letter and the employer or you can just pay the tax and no it’s wrong if you want to keep the job for sure then file an information referral on the employer that might be better.
To answer your question, you need to make quarterly estimated payments to the IRS. You will owe penalties if your payments are not by the quarterly deadlines.
You can create an account and do it on line on irs.gov, or download form 1040ES and mail in checks. If you do it on line, be careful with the drop down telling them what the payment is for! (I made payments for the wrong tax year, once.)
If you want to be sure you don’t have a big tax bill next year, I’d recommend 30% this year, until you see how everything falls out. You will have to file your taxes using Schedule C.
Be sure to keep records for anything that could be deducted as a business expense, including mileage. I claim 50% of my cell phone and internet, for example, since I use both for my side business. You may have work clothes and shoes, and any supplies you purchase. Keep your receipts!
There is no such thing as a 1099 employee.
Report it to your state’s department of labor. What’s being done to you is highly illegal.
Report the peep to US DOL wage/labor division.
Until then, you’ll need to set some aside (I think 15%) for self employment taxes, plus more for federal taxes and state taxes if you have those. The bonus is you’ll be able to claim work-related expenses as business expenses and reduce your taxable income, such as work uniforms and possibly travel expenses and even cell phone if used for work. An hour consultation with a CPA will be of great guidance here.
As everyone else said, if your employer tells you when to work then you are almost certainly a normal employee, not a self-employed 1099 contractor. Your employer doesn’t get to decide this themselves, the IRS sets the rules for what takes to be self-employed or not and they are pretty straightforward to check.
[https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee](https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee)
Honestly, what you described does sound a lot more like a W-2 setup than a true independent contractor arrangement, but I understand not wanting to blow up the opportunity right now. Since they’re treating you as 1099, you should plan as if no taxes are being withheld at all.
Setting aside roughly 25-30% is smart, so you’re already thinking about it the right way. And yes, if you continue earning enough income this way, quarterly estimated taxes may apply because you’re responsible for both income tax and self-employment tax.
You may still have some deductions depending on expenses tied directly to the work, but if they control your schedule, duties, training, equipment, etc., there may not be many legitimate contractor-style deductions available. Tbh, keeping good records now is the most important thing so you don’t get surprised later.
They need to be reported. If they schedule you, you aren’t a 1099. They’re abusing tax laws.
For now, keep 30% of your check aside for taxes and liability but as a 1099 you also need your own insurance because everything you do is something you can be held legally responsible for.
This is incredibly sketchy.
If they scheduled you, and you couldn’t miss shifts if you wanted to, you’re an employee
Sorry you are not 1099 and your employer knows it, yet here you are
To answer your questions, regardless of whether you ‘should’ be designated a 1099 employee–Yes, you should pay estimated taxes quarterly. This is probably the easiest way to calculate: **The Safe-Harbor Method (Prior Year):** Pay 100% (or 110%) of the total tax shown on your previous year’s return. This is the simplest method if your income is relatively stable, dividing that total into four equal payments.
edit, here’s good guide: [https://www.fidelity.com/learning-center/smart-money/estimated-tax-payments](https://www.fidelity.com/learning-center/smart-money/estimated-tax-payments)
[https://www.dol.gov/agencies/whd/flsa/misclassification](https://www.dol.gov/agencies/whd/flsa/misclassification)
What your employer is doing is illegal. You are not in a position that would be 1099
I forgot to say I’m sorry you’re having to deal with this. It sucks and I hope you can find a better employer soon.
I get that you need the job, but you should already be looking for a better one. Meanwhile, you’re probably setting aside too much for taxes. Self-employment tax on $750 is about $106. Assuming you average $750 per week, your taxable income for a full year will be about $20,500 and your total tax about $7,700. You only need to set aside $150 per week for taxes.
You can take this estimated tax of $7,700, divide by 4 and send in $1,925 per quarter on the estimated tax due dates of 4/15, 6/15, 9/15 and 1/15.
Read up on Schedule C business deductions. You may qualify for some. Don’t buy things you don’t need just to get deductions though.
It depends how much, if anything, they withheld, but you’re likely going to owe a lot more than $250 in taxes.
1099 v w2 isn’t about a choice. There are guidelines and it’s likely your employer is violating them.