I earned several thousands bucks only for 2005 by doing data entry at home, do I have to file schedule C-EZ?

Question

I file the tax return with my hubby jointly. Any specific details we have to pay attention? Thanks.

Answer 1

If you recieved a W-2 then it goes on the 1040 line 7 with wages. If you recieved a 1099, or if you didnt recieve either one, for this income then you should file a Schedule C. You should have recieved a 1099 from anyone who paid you more than $600. You will also have to file a schedule SE for self employment tax. You owe self employment tax if you made over $400 in self employemt. Self-employment tax is social security and medicare. If you're self employed you have to pay your half, and what the employer would pay, which is 7.65 percent each, 15.3 perent.

Answer 2

The question is not which form but if you actually owe the resulting self-employment tax.



SE tax comes from C form earnings. It is about 15% after you take all your deductions. Maybe a few hundreds bucks is not worth bothering with for you.



For me, it is. Always. So I go the extra mile to keep George Bush poor.



If you were not actually in business as a self-employed data entry worker, you might not owe any SE tax and you can report the income on the face of the 1040 as "other income".



IRS lost a case on this point, cited as Batok v. Commissioner. Your tax issue, like Batok, may come down to whether your income was irregular and rose to the level of a business enterprise.



Mr. Batok put in some windows at an office building. The business paid him, deducted the expense and sent him a 1099. The special judge ruled that Batok was not self-employed, even though he got a 1099, was not required to file a form C of any kind, and was not subject to SE tax.



People, such as my fellow posters, might not have fought the IRS using this rationale. They may think you should pay more tax. So what? The cite is Batok and lays out the complete basis that might help you. That is if a few hundred of your dollars are worth your effort.



If after reading Batok, you may discover you likely were self-employed. For example, you got a business license or you had cards made for your business. Then, you get a regular form C and write down every deduction to reduce the amount of SE tax.



BTW, never use any EZ or short forms. You may lose rights to amend your returns and may lose refunds or other goodies that Mr. Bush wants you to have.



Now be a good sot and give your uncle Eric his 10 points.

Answer 3

This data isn't terribly specific but you should be able to use the 1040EZ if you have been sent 1099's from your various 'employers'. I strongly recommend you spend a couple bucks purchasing tax software b/c these questions will be easily answered for you. I have owned a small business for several years and tax software has been a lifesaver. If you are a sole prop get software for Home and Business. It will run about $70 and will be worth every penny. H&R (I am not advertising so won't type name) is what I have used for the past several years but others are good as well.