When Would I Provide a W-2 and 1099 Form to the Same Person?

W2 + 1099 FormA worker’s role determines which information return you would provide. You provide a Form 1099-Misc to independent contractors and Form W-2 to employees. However, there may be instances where a worker may be serving as an independent contractor and an employee for the same entity.

A Federal Tax court case, Ramirez V. Commissioner, stated, “that the fact that a person is an employee in one capacity does not foreclose the possibility that he can be an independent contractor with the same employer in another context”. Employers need to review the details of their payment arrangements with their employees to correctly classify them for W-2 and 1099 tax purposes. Some quick examples of people who correctly should be given both a W-2 and a 1099 in the same year are:

• An employee of a property management company also provides contractor/maintenance [Read More]

August 27th, 2017|Articles|

Amazon FBA and Your Taxes

Amazon Pic

Amazon through their FBA program, makes it easy for online sellers to operate an online store. It has in fact opened up the US consumer market to a lot of non-US individuals who may not be aware that they are creating an obligation to file US tax returns.


What makes FBA different?

Generally speaking Amazon FBA creates an agency relationship between you and Amazon, which makes Amazon your agent in the US. Under most tax laws that means you have a physical presence in the US and in a large number of states in the US because your agent (Amazon) is physically located in the US and in a number of states in the US.

I see this situation treated incorrectly a lot, because people tend to focus on the exclusion that is commonly available under tax treaties and tax statutes to [Read More]

March 18th, 2017|Articles|

2016 Self Directed IRA Tax Reporting Requirements

Self-Directed IRA investors should be aware of the following IRA tax reporting responsibilities. Some of these items are completed by your custodian and some of them are the IRA owner’s sole responsibility. Here’s a quick summary of what should be reported to the IRS each year for your self-directed IRA.

IRA CUSTODIAN FILES – Your IRA Custodian will file the following forms to the IRS annually:

  1. Form 5498: Filed to the IRS by your custodian. No taxes are due or paid as a result of Form 5498. IRA contributions, Roth conversions, the account’s fair market value as of 12/31/16, and required minimum distributions taken.
  2. Form 1099-R: Filed to the IRS by your custodian to report any distributions or Roth conversions. The amounts distributed or converted are generally subject to tax and are claimed on your personal tax return.IRA distributions for the year, Roth IRA conversions, and also rollovers that are [Read More]
January 14th, 2017|Articles|