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How much tax do you pay on 1099 income?

Asked by: bustermcleod 1327 views YA Discussion

So today my employer gives me a 1099 form for 2011 stating I received $ 18000.00 that did not process through payroll. I occasionally received a handwritten check about a half dozen times last year but thought nothing of it. My W-2 did seem a little small now that I think of it.I already filed my taxes in February and received the form in the second week of April.(??) Aren’t they required to provide this in January and at least tell you beforehand? How much tax do you pay on 1099 income?

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3 Answers



  1. Cathi K on Apr 10, 2012 Reply

    The IRS does not like seeing a W2 and a 1099 from the same employer. This makes you a self employed contractor. Were you? Your employer is trying to get away with something. They were supposed to be mailed by Jan 31. You have to file a schedule C and pay your and your employers payroll taxes.

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  2. SumDude on Apr 10, 2012 Reply

    You will need to use a 1040X and do an amended return to add your 1099 income on top of your W-2 income. In that sense, it will be taxed at the upper rate that it is in (20 – 25%??).

    On the Schedule C you will compute net income, and then both “halves” of employee and employer social security taxes (5.65% + 7.65%) on the Schedule SE (self-employment) and that sends you to line 27 on the form 1040 where you post the deductible part.

    You will very likely owe an underpayment penalty, and if it is not done by April 17, other penalties. At least find out how to file for an extension to do a 1040X and make a good faith payment on what you will owe – if you can.

    Yes, your employer should have gotten the 1099 out earlier, but you were supposed to keep track and make quarterly estimated payments {or have enough withheld from your regular paycheck to cover the taxes, – which could have been $ 600 or more per month, as a (hopefully high) rough estimate [18000 x 40% / 12 months a year.]}

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