Do You Have To Pay Social Security On A 1099?
December 20th, 2009 by admin | Filed under social.My husband was a consultant as a second job and was paid for his services. The company did not take out taxes or social security. Do we need to pay social security on this income? The form was a 1099.
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Social Security tax may be owed. Medicare will be owed.
No additional SS taxes are paid on wages greater than $97,500.
You report the income on Schedule C, and figure the additional Social Security and Medicare taxes on Schedule SE.
Plus he will pay federal income tax on it too, it he shows a profit after deducting expenses. The only difference between a Misc 1099 and a regular W-2 is that when you get a W-2 your employer pays the other half of your social security and medicare. You pay half and they pay half. With a 1099, you pay both halves. You still pay federal income tax on the wages. If he plans to do this again next year, he will need to make quarterly tax payments equal to what he paid on this 1099. Or he will be hit with penalties for not filing them quarterly. The IRS wants to make sure that you are withholding your taxes the same as if you were working with a W-2. Unless like everyone else said, he had already made $97,000 on his other job. That is the cut off for withholding social security for the year.
When you are self-employed, social security and medicare are call “self-employment tax” and it is calculated on Schedule SE.
The consulting income is reported on Schedule C and the net flows through to the 1040 and Schedule SE.
You bet. It has to go to schedule C (or C-EZ) which will pass through to the schedule SE. This is where he will pay his FICA (SS & Medicare).
If your husband works as an independant contractor he has to pay social security tax, unless his first job pays him more than the limit for which he has to pay social security