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Proof of self employment.

February 14, 2015 01:47PM
Well even though Turbo Tax told me I had a very low chance of being audited.....they lied! Yes the IRS chose me this year for the big A word. So my question is does anyone know what is acceptable proof of self employment if you dont have a 1099? Me being honest, I reported all my mystery shopping income, but only have one 1099. From talking with someone who went through this last year, the IRS is pretty strict on what they accept for proof.
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February 14, 2015 02:13PM
Do you have records of direct deposits or PayPal transfers from MSCs?

I'm not sure just what "proof" they could ask for other than lists of jobs performed and payment and records of your mileage and other expensess. Are they alleging that you were just a hobbiest? Are they questioning your eligibility for Earned Income Tax Credit? If you kept good mileage records and other expense records, that will go a long way.

Based in MD, near DC
Shopping from the Carolinas to New York
Have video cam; will travel

Poor customer service? Don't get mad; get video.
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February 14, 2015 02:20PM
Pamela, your Paypal and bank accounts should reflect payments received. If you received checks and cashed them rather than making a deposit, you will have those check stubs.

Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.
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February 14, 2015 03:48PM
They are questioning my elgibility for earned income. I asked another lady who is self employed and went through it last year if they would accept something from pay pal and she said no. I was paid by either direct deposit or pay pal except for maritz and i have their 1099.
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February 14, 2015 04:55PM
Pamela, perhaps you can furnish the IRS with the amount earned from each company and they can verify your earnings with the companies. Your Paypal statement will show who deposited how much, likewise your bank account, so if you don't have a spreadsheet on that income you can extract the totals on individual companies from those documents. Since they are questioning your eligibility for earned income, I'm guessing what's in question is the amount that you reported earned. You will have to account for the money you reported earned or the earnings you reported will be reduced. If they are not questioning your income totals, perhaps they are questioning your expenses or even possibly a lack of reported expenses which would jack up the income. When you get into the actual audit, you'll learn more about what they need to see.

Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.
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February 14, 2015 07:14PM
don't trust 'another lady'

your bank records with deposits from MSCs and your paypal records are a good start..try to verify the deposits are from MSCs...make a list of company name/addresses/websites as well as specific payment info (if the name is different)

also, try to get some documentation about the MSCs..print a page of a MSCs shops...black out the client name if its listed....have samples showing being paid cash and reimbursed...

even if you don't get a 1099...you can usually print your records off a MSC website....i don't know how many years back you can go...it may vary by company....

I HAVE BEEN THROUGH 2 AUDITS>>>THE IRS AGENTS ARE STUPID>...THEY MAKE UP THEIR OWN RULES...I HAD TO REPEATEDLY SEND COPIES OF THEIR OWN RULES TO THEM.....and yes i did win..
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February 14, 2015 09:13PM
Thank you everyone for your replies. I got my letter today. They arent even questioning my self employment. Just relationship to the kids and proof they live with me. That's one less worry off my shoulders. I have the proof for everything else.
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February 15, 2015 09:58AM
Good news!

Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.
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