Sometimes it seems to us that 1099 work and its definition is very simple, you just hire a person who is determines himself as self-employed and ready to carry out the task but in fact many people make penalty rouse mistakes when hiring an this type of employee and don’t quite know 1099 form definition or because they can not correctly classify who they need – a regular employee with which they cooperate by W-2 even or freelancer who is used to W-9.

1099 Work

In 2018 there is a big popularity for companies that hire self-employed individuals. First of all it is profitable for the job givers themselves since they are not obliged to pay half of the total tax sum of the employee which is spent on medical care or social security or FICA taxes. On the other hand – it is beneficial for the employee since the employer not particularly concerned how the job was done till it’s made in time with satisfactory result.

That is, the job allows to perform it at flexible schedule and no one keeps track of your every move, vendor is simply an intermediary between the customer of his company and the employee who performs the ordered service.

FLSA and other ways to determine job status

The US tax service has an act that allows you to determine your status by fair labor standards so you clearly understand whether you should be hired as freelancer or be officially employed.

According to this act you should take a close look at:

  1. Wether you have to be in order for work expenses
  2. Wether you carry out executive role
  3. Aren’t you economically dependent on job market?
  4. Are you working on constant basis or time to time.

One other way that helps to make up your mind is IRS 3 Prong Test which is basically the same but might be less specific.

Paperwork: how to find and file 1099

You can order some forms that you need to fill directly from IRS site. This is the best way to verify the authenticity of the document and also get the current version of the file, there you can also check whether the new version has been produced to be used in the next year.

Never use a printable sample of the fill out instructions that you can find along with normal docs because IRS does not accept that. You can easily find out what blank is not suitable for use since lines and text are marked with different color (other than black). To fill out the blank use data from w9.