Thanks for this specific breakdown! Yes to all of those questions - they assigned clients, partners reviewed everything before it went out, I had set office hours (9-6 generally), and they provided everything including legal research software and admin support. Sounds like Form 8919 is definitely the right approach here.

You're welcome! With all those factors, you're clearly describing an employee relationship, not an independent contractor situation. Form 8919 is absolutely the right approach. Just one more tip - in Section 3 of the form where it asks for the reason code, use code G since you received both a 1099 and W-2 from the same firm in the same year. This is a textbook example of when to use that code. And keep copies of any firm policies, emails about work requirements, etc. that demonstrate the control they had over your work, just in case questions come up later.

Yes, TurboTax does support Form 8919! I used it last year for this exact situation. When you enter your 1099-MISC, it will ask a series of questions about your working relationship with the payer. Answer those honestly, and if it determines you were misclassified, it will guide you to Form 8919 instead of Schedule C/SE. One tip though - make sure you're using at least TurboTax Deluxe. The free version doesn't support this form.

Wait seriously?? I have another similar internship lined up for summer. How do I figure out how much to pay for these quarterly payments? My income varies a lot because I also have a part-time W-2 job during the school year.

For variable income, you have a couple options. The safest is to use the "safe harbor" provision - pay either 90% of your current year's tax or 100% of last year's tax (110% if your income is over a certain threshold) divided into quarterly payments. With a mix of W-2 and 1099 income, you could also increase your W-2 withholding to cover your expected 1099 tax liability. Just submit a new W-4 to your employer requesting additional withholding. This can sometimes be easier than making separate quarterly payments, and withholding is considered even throughout the year even if it's all done later in the year.

Seconding this! Michigan has a separate tax for self-employment over a certain amount. I almost missed it my first year and would've gotten a nasty surprise later.

Florida requires C corporations that are doing business in Florida to file Form F-1120 (Florida Corporate Income Tax Return) regardless of whether they have any tax liability. Even if your corporation falls below the income threshold where you'd owe tax, you typically still need to file the return. There is an exception for corporations not doing business in Florida and corporations that have no income reportable to Florida. So it depends on where your C corporation is operating and generating income. Florida does have filing exemptions for certain entities like S corporations and certain non-profits, but standard C corporations generally need to file.

Is that $1,200 threshold the same for 2024? My daughter's bonds will be right around that amount next year, so trying to figure out if we need to plan for potential tax liability.

For 2024, the threshold is actually $1,250 - it was adjusted for inflation. If your daughter's interest and other unearned income will be close to that amount, you might consider tax planning strategies like potentially moving some income to 2025 if possible. Remember that the kiddie tax only applies to unearned income (like interest), not to earned income from a job. So if your daughter has any employment income, that's handled differently and has its own standard deduction.

I used TurboTax last year with this exact situation. It doesn't handle it automatically - you need to manually enter the correct interest amount (only what you get to keep after the penalty) on Schedule B. TurboTax won't calculate the penalty for you or guide you through which interest months to include/exclude.

Thanks for this clarification! So if I understand correctly: I should definitely file Schedule C with my business expenses to reduce my self-employment tax, but that's completely separate from deciding between itemized vs. standard deduction? And since my total income is only around $32,500, the standard deduction ($13,850) is probably better unless I have some major itemized deductions?

Yes, that's exactly right! File Schedule C to report your 1099 income and expenses (which reduces or eliminates self-employment tax on that income). And yes, at your income level, you'll almost certainly want to take the standard deduction unless you have extraordinary itemized deductions like major medical expenses, huge charitable contributions, or large mortgage interest payments. For most people in your situation, itemized deductions don't exceed the $13,850 standard deduction.

Just be careful with the home office deduction - it has to be a space EXCLUSIVELY used for business. If you sometimes use that desk/room for anything personal, it doesn't qualify. I got audited over this once.