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Another thing to consider - if you're misclassified, you're probably missing out on overtime pay too! If you're working until "all houses are done" with no set end time, I bet there are weeks where you go over 40 hours without getting time-and-a-half pay. When I was misclassified at my previous job, I not only filed with the IRS, but also with the Department of Labor for unpaid overtime. Ended up getting back pay for almost a year's worth of overtime they never paid! Just something else to think about.
Omg you're right - we definitely go over 40 hours some weeks when there are more houses or deep cleans scheduled. I didn't even think about the overtime angle! How did you go about filing with the Department of Labor? Was it complicated?
Filing with the Department of Labor was surprisingly simple. I went to the DOL website and filed a wage complaint through their online system. You just need to provide details about your employer, your work hours, and how you were paid. After I submitted the complaint, a DOL investigator contacted me within a couple weeks. I shared my time records (I had kept my own log of hours worked in a notebook), and copies of payment records. They handled the entire investigation and calculated what I was owed. The whole process took about 3 months, but they recovered all my unpaid overtime plus damages.
Has anyone considered that the house cleaning industry has a lot of grey areas? My mom runs a small cleaning business and she says many cleaners prefer 1099 status because they can write off mileage and other expenses. Maybe your boss thinks she's doing you a favor?
While some workers might prefer contractor status for the deductions, that's not how tax law works. The IRS has specific criteria for worker classification regardless of what either party "prefers." If a worker meets the employee criteria (like OP clearly does), classifying them as a contractor is illegal tax evasion. Also, in this case, the workers can't even claim mileage deductions since the company provides the vehicles and pays for gas! They're getting all the downsides of contractor status (higher self-employment taxes, no benefits, no protections) with none of the advantages.
Honestly the whole self-employment tax thing is a mess. I did food delivery for 3 months last year and made about $2000. The most important thing to know is you NEED to file Schedule C and Schedule SE even with that small amount. The $400 threshold is the key here. But don't panic too much about owing a ton. After mileage deductions, I barely owed anything. Just make sure you track your miles carefully for next time - use an app like Stride or MileIQ. I didn't track well last year and regretted it.
Is there anyway to estimate mileage after the fact if you didn't track it? I did some driving for Uber Eats but totally forgot to log miles.
Yes, you can estimate your mileage after the fact, but you need to be reasonable and have some basis for your estimate. If you have delivery history in your app, you can use that to reconstruct your mileage. Most delivery apps keep a record of your deliveries, so go through your history and map out the routes you took. Remember that you can count all business miles - driving to pickup locations, to customers, and returning to busy areas after deliveries. Just be careful not to include personal miles. If you're audited, the IRS will want to see some documentation, so create a log now with your best estimates and note that it's reconstructed. It's not ideal, but it's better than not claiming the deduction at all.
does anyone know if you need to keep the 1099 misc form after you file? my tax person said i do but my mom says once its filed u dont need it
Keep ALL tax documents for at least 3 years after filing! That's the standard period the IRS can audit you. Some people recommend 7 years to be extra safe. Your tax person is right - don't throw them away!
Has anyone used TurboTax to handle furniture depreciation for rental properties? I'm trying to figure out if the software can track individual asset depreciation schedules or if I need something more specialized.
TurboTax does have a rental property section where you can add depreciable assets, but it's pretty basic. It doesn't handle tracking the disposal of individual furniture items well over multiple years. I switched to TaxAct which has slightly better rental property features, but still had to maintain a separate spreadsheet for tracking my furniture items.
Thanks for that info! Sounds like I might need to keep a separate tracking system regardless of which tax software I use. I'm guessing none of the consumer tax programs really handle the complexity of multiple furniture items with different depreciation schedules and disposal dates.
One thing nobody mentioned yet - if your foreign country charges any kind of property tax on the furniture itself (some countries do this separately from real estate), you might be able to claim the Foreign Tax Credit for those taxes. It's another form to file but could offset some of your US tax liability. Also, make sure you're converting all your furniture costs and depreciation calculations to USD based on the exchange rate when you purchased the items, not current rates. This tripped me up for years with my rental in Thailand!
When you do file, make sure you look into potential deductions for this income. Was any portion of your phone bill used for this work? Did you use a dedicated space in your home? Any special equipment? All of these could be partial deductions that would help offset the taxes you'll owe.
Just be careful with home office deductions. The IRS scrutinizes those pretty closely. You need a space used exclusively for business purposes, not just your bedroom where you also sleep, watch TV, etc.
Just a heads up - if you do decide to report this income next year instead of this year, be aware that the company might issue a 1099 for the current year even though you earned the money in 2022. If that happens, you'll need to explain the situation if the IRS questions the discrepancy. Generally, it's best to report income in the year you receive it if you're a cash-basis taxpayer (which most individuals are).
That's a good point I hadn't considered. So there's a chance the company will issue a 1099 for tax year 2023 or whenever I actually get paid, even though the work was done in 2022?
Exactly. Companies issue 1099s for the calendar year in which they made the payment, not when the work was performed. So if you get paid in 2023, you'll get a 1099 for tax year 2023, even though you did the work in 2022. This actually works in your favor in terms of timing, since you want to handle this separately from your parents' filing. Just be aware that from the IRS perspective, you report the income in the year you receive it (assuming you're a cash-basis taxpayer, which almost all individuals are).
Miguel Ortiz
Make sure you check if you're eligible for any property tax exemptions with the newly built house! Many counties offer homestead exemptions, and some have additional ones for veterans, seniors, or primary residences. This could save you thousands each year. Also, keep all documentation about this situation - the original escrow refund, the tax bills, and receipts of payment. Tax assessments on new construction often get adjusted in the first 2-3 years as counties fully process everything, and having a paper trail will help if there are any disputes.
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Amara Okafor
ā¢Thank you for this suggestion! I didn't even think about exemptions. Do I need to apply for these or are they automatic? Our county website is pretty awful and hard to navigate.
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Miguel Ortiz
ā¢You almost always need to apply for exemptions - they're rarely automatic. Most homestead exemptions require an application within the first year or two of occupancy. Your county's tax assessor's office should have the forms, even if their website is terrible. It's worth calling them directly or visiting in person since these exemptions can save you significant money every year. Some counties also have partial exemptions for energy-efficient new construction, so ask about that too if your home has any green features. Don't wait on this - many exemptions have filing deadlines that, if missed, mean you'll have to wait until next tax year.
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Zainab Omar
Don't forget to double check if your property tax bill is paid in arrears in your state! This is super important. In some states, you're paying for the previous year's taxes, while in others you're paying for the current year. If you're in a state that pays in arrears, that bill might actually be for the time period when your house was still under construction, which might explain some of the confusion.
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Connor Murphy
ā¢This is such an important point! I'm in Illinois and our property taxes are always paid in arrears. Made for a very confusing first year in our new build because the tax bills didn't match what we expected.
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