16
Jan

I have a tax question, how much can I pay 17 yrs old who is depended, that is not related to me, without him paying federal tax? I will provide him a 1099. I reside in California. Any suggestions? Thanks in advance!


Answer:
There are specific IRS rules on what type of job you can pay a person on a 1099 for, and it would be unusual for a 17 year old to have that type of job rather than one as an employee where you'd take out taxes and give him a W-2, not a1099.

With a 1099 he'll have to file a federal tax return and pay tax if it's $400 or over. He wouldn't owe income tax if his income is under $5350, but will owe self-employment tax (for social security and medicare) starting at $400.


Answer:
As much as you like. There is no limit on the income of a minor living with his parents unless he is supporting himself with the income.

Answer:
I think there is somewhere on your tax return that asks if you had taken care of someone. My current mother-in law could've claimed me when I lived with her before I got married to her son

Answer:
Are you saying it is your DEPENDENT but is not related to you that you are paying wages? If the work is under your control you must issue a W-2 instead of a 1099. This is governed by IRS guidelines as to the work relationship, employee or independent contractor. Perhaps you are saying he is an independent contractor.

Your question is a little unclear perhaps you can clarify a bit to get an accurate reply.


Answer:
you can't just do that - only certain kinds of work would qualify for paying him like a self employed contractor. if you pay him as a 1099 - you are forcing him to pay employers share of FICA taxes. As a 17 yr old, he does not have the qualifications to be considered a contract employee - pay him like a normal paycheck employee - he could fight it later otherwise and you would lose and get penalized

This entry was posted on Wednesday, January 16th, 2008 at 9:25 pm and is filed under Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or TrackBack URI from your own site.

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