Discussion:Auto Allowance on 1099-Misc
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Discussion Forum Index --> Basic Tax Questions --> Auto Allowance on 1099-Misc
Discussion Forum Index --> Tax Questions --> Auto Allowance on 1099-Misc
| 29 May 2008 | |
| What would you do with this? Client has a W-2 and 1099 for the same company, the 1099 is an auto allowance - a flat $600 per month, not accountable. It's not SE income, it's an auto allowance. | |
Death&Taxes (talk|edits) said: | 29 May 2008 |
| Put it as a reimbursement on the 2106.....more than likely the 7200 could exceed the allowable expense and go to Line 7....if not, you might have a CP2000 next year, but it is explainable. | |
| 29 May 2008 | |
| That's what I was thinking, expenses on the 2106 and the 7200 as reimbursement. Thanks. | |
| 29 May 2008 | |
| how does Dennis do that little whistle?????
Does anyone care about following the rules or doing taxes correctly? | |
| 29 May 2008 | |
| Kevin, you have me waiting with bated breath (http://www.worldwidewords.org/qa/qa-bai1.htm)
The problem starts with the employer not reporting it correctly as wages on the W-2. Kathyt is only trying to clean it up after the fact. What is the correct way, if not reporting it as an excess reimbursement on the 2106? | |
| 29 May 2008 | |
| the correct way is to get it corrected at the employer level
the next best thing is to treat it the same way as if it were reported correctly - which in this case is by using that new form for a 1099 received instead of a W-2. Of course the IRS won't catch it if you do it incorrectly, as either Barb and DT suggest, but who wants a sloppy tax professional (even if it results in less tax)? You folks are better than that. one mistake doesn't justify another. | |
| 3 June 2008 | |
| The problem with getting it corrected at the employer level is that we have already tried. The employer is my client's father, and he will not budge, he "knows what he is doing and doesn't need us to tell him how to run his business" is close to a quote. I also thought about using that new form (8919) but my client didn't want to, his father is the employer. He hopes to one day take over this business, which is not likely to happen if his father fires him over this. | |
| 3 June 2008 | |
| if his father fires him for doing his taxes correctly, then he doesn't want his father's business anyways - there are sure to be many many many potential problems in the business that the IRS could find | |
