Discussion in 'Associated Content & Writing Articles' started by AnThRaXx, Feb 11, 2010.
College financial aid
Yes, they report your earnings to the IRS when you earn a certain amount of money, thus you need to fill out a W9. If you make below the set amount, it won't affect you.
When you fill out a W9, you are essentially saying that you are an independent contractor and responsible for your own taxes (as opposed to an employee, subject to payroll withholding.)
If you earn $600 or more from any one place where you have on file a W9, they are required to send you a Form 1099 at tax time (instead of a W-2)
It will affect your income taxes, because you must report it as income. Just like a W-2, a copy of a 1099 is also sent to the IRS, so you don't want to ignore it.
It will also affect your college financial aid, because that is based upon your tax return.
As far as child support, I am a bit less familiar with that, and I think it varies state to state in how they compute it. If all of your earnings are made this way, they would probably look at your schedule c from your tax return, and take into consideration business expenses as well.
If you make even a large percentage of your income as an independent, you also need to be paying your estimated taxes quarterly, as well as self-emplyment (medicare) taxes.
It would probably be a VERY good idea to talk to a tax professional for advice.
Hope this helped a bit.
If you are in education i would recommend simply submitting content to the $600 limit, then discard that account, start a new one and begin again, while still collecting the performance pay for the original account. that way all your earnings will be tax free and your child benefits etc wont be affected.
It is actually not that simple. It wouldn't be based on an account, but on your tax id # or ss#, whichever you use. It isn't as easy as that to get around the IRS. If it were, people wouldn't be arrested for tax fraud all of the time.
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