How Do I File My Tax Return If I Get a 1099 Misc?

Just $600 worth of freelance work for a single client is all it takes to generate a Form 1099-MISC.
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Form 1099-MISC is the self-employed person's equivalent of Form W-2. The form shows the amount you were paid. It doesn't matter whether you did one big project or multiple smaller gigs: Any single party for which you performed an aggregate of $600 of work in the course of trade or business must file a Form 1099-MISC.

Step 1

Identify on Form 1099-MISC the amount you were paid. (If a company paid you royalties of at least $10, the amount will appear in Box 2.) You'll find non-employee compensation -- pay for work as an independent contractor -- in Box 7. Self-employment income isn't normally subject to withholding, but if the company did withhold taxes, that amount will be shown in Box 4.

Step 2

Add up all the 1099-MISC income received from your different clients. On top of that, add everything you received from clients who didn't send a 1099-MISC -- those, for example, for which you did only $500 worth of work. Everything you earn as an independent contractor is taxable.

Step 3

Report your total income on Schedule C if you own your own business. Otherwise, report it as "other income" on the front of Form 1040.

Step 4

Deduct your business expenses, such as travel or business supplies. If you're self-employed, report them on Schedule C. If you report "other income," you can only list expenses as itemized deductions on Schedule A. If you take the standard deduction, you cannot deduct expenses.

Step 5

Report your income on Schedule SE if you're in business and had net earnings of $400 or more. Add the tax you calculate on the form in with your income tax to figure your total payment. You can also write off half the tax against your taxable income.

Step 6

Send in your return, but keep the 1099-MISC for your records. The company that sent you the form must send a copy to the IRS.

Tip

If you did work for a private individual instead of a business, she doesn't have to send you a 1099-MISC. This applies no matter how much the individual pays you. You still have to report the taxable income, however.

Things You'll Need

  • Schedule C

  • Schedule SE

  • Form 1040

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