Hi everyone,

I was wondering if anyone is doing their taxes through an H&R Block office (not online). My tax preparer is asking for each and every one of the 1099's even under the $600 threshold, in order to process my taxes, "as a protection because those are the rules with H&R Block".

If you are, can you please share with me (private message if you prefer) the phone number and name of your H&R Block tax preparer, preferably here in Southern California, so that my tax preparer can call him/her about how to deal with the situation? Nobody in her office seems to have dealt with the situation when I have a lot of small income with no 1099's even though I have all the shops fully documented.

Please don't tell me "switch to online" or "switch to a different company" as those are not options for a particular reason (and no, I'm not shopping H&R Block locations either, and no I'm not trying to do anything illegal nor questionable). All I want to figure out is an H&R Block agent who has dealt with this before and knows how to do it and tell that to my preparer.

Any help will be appreciated, thanks!!

A "real" tax preparer would realize companies do NOT send 1099s unless required (i.e., over the $600 requirement). Just tell him/her "this goes on Schedule C. My total income from self-employment was
$XXXXXX, and here's a list of Schedule C deductions. Companies do not send 1099s if I earned less than
$600, but my records are complete".

@ceasesmith wrote:

A "real" tax preparer would realize companies do NOT send 1099s unless required (i.e., over the $600 requirement). Just tell him/her "this goes on Schedule C. My total income from self-employment was
$XXXXXX, and here's a list of Schedule C deductions. Companies do not send 1099s if I earned less than
$600, but my records are complete".

Thanks, I know that, but apparently H&R policy is to capture all 1099's as backup in the event of an audit, or so I'm being told. That's why I want to find another more experienced H&R Block tax preparer... I really feel like going back to TurboTax but unfortunately is not an option for me

Why not just ask to speak to a supervisor or have the tax preparer call their home office? I am absolutely certain H&R block is familiar with self-employed people. Consider asking to be assigned another more experienced tax preparer.

@jnoyolapicazzo wrote:

@ceasesmith wrote:

A "real" tax preparer would realize companies do NOT send 1099s unless required (i.e., over the $600 requirement). Just tell him/her "this goes on Schedule C. My total income from self-employment was
$XXXXXX, and here's a list of Schedule C deductions. Companies do not send 1099s if I earned less than
$600, but my records are complete".

Thanks, I know that, but apparently H&R policy is to capture all 1099's as backup in the event of an audit, or so I'm being told. That's why I want to find another more experienced H&R Block tax preparer... I really feel like going back to TurboTax but unfortunately is not an option for me

If you've given H&R Block all the 1099s received, that IS "all" of them.

I went to H&R Block this year, too, and the preparer accepted the 1099s I had, and took my word on the rest.
I did tell her I had bank records to support the other companies (the ones I didn't earn at leas $600 from).

I was going to start a new thread but do we really need another tax-related thread? I got this tax alert from one of my MSCs. Just thought I would throw another wrench into the system.

"2/17/2016: 1099's Including Reimbursement Payments

We've received quite a few emails from shopper regarding the 1099's including reimbursements along with shop fee payments. The IRS allows companies to include reimbursements in the total. When this is done, it's the shopper's responsibility to offset all monies earned with any expenses against the earnings. Keep in mind that ALL mystery shopping payments are supposed to be submitted to the IRS as earned income. And, you may itemize expenses to help offset your earnings. We are unable to provide any assistance with completing your tax return and suggest consulting with a CPA or tax specialist if you should need additional assistance. Please do not request a new 1099 to be issued with the reimbursements deducted as we will be unable to honor the request."

If the person preparing your taxes doesn't understand that 1099 forms are not issued unless you receive $600 or more from a company, then you definitely have the wrong person doing your taxes.

Wait until you have to explain that PayPal does not issue a 1099-K Form unless you have received an aggregate of at least $20,000 AND over 200 separate payments. Of course, you are still responsible for reporting all of your income on Schedule C regardless of how much or how little you receive. To save another post, here is the reference to the rules under which PayPal operates vis-a-vis 1099-K forms: [www.paypal.com] Ask your H&R Block tax preparer if they are familiar with IRS Section 6050W, then when they look completely baffled, decide what you think you should do. I know what I would do. But then, I would never be confronted with that problem.

I know someone who is a complete idiot that took the H&R test and passed. Unless your dealing with the H*R block owner who is a real tax consultant, I would rather see you attempt the schedule "C" yourself.

It's not that hard. You have to have proper records to fill it out and this is why you need to maintain the spreadsheet all year. If your spreadsheet is accurate, then you are better qualified to do your taxes than any idiot from an H&R block office.

They basically prey on low income wage earners and attempt to give them a short term loan to give them the return cash ahead of time for a loan fee. Most would qualify for free return directly from the IRS and get the return as quickly as the H&R block stealing a % of their return.

I consider the whole thing a scam. There is much fraud and the more fake dependants the merrier. The IRS allows undocumented dependants, so it means a fraudulent tax return company can defraud us real taxpayers thousands of dollars. They will "fix" the return to get the maximum "earned income tax credit"

This is basically the sweet spot of where you claim to earn the lowest amount of income and get a refund for being so poor. Each dependant makes this number higher. A common fraudulent tax preparer will make a fake company I.E. independent contractor where you made enough money to qualify for the gov't handout and not enough to pay for Obama care or any tax.

If you do enough MS, you could fall into this sweet spot if that is all you do, but doubtful if you claim mileage.

Are you saying the earned income tax credit can result in someone getting more money back than was paid in?

That is indeed possible. It does not always happen, but it is possible.

@LisaSTL wrote:

Are you saying the earned income tax credit can result in someone getting more money back than was paid in?

Thanks. I was wondering how getting back a portion or even all the money paid in could be considered a government handout.

Sybil, I think that's just lazy of the MSC. It's a HUGE hassle to separate these out unless you're OCD about receipts. It would be so much easier for them to separate it as it goes into their accounting. If they're going to add to my time, they need to be compensating for it.

How come giving the working poor a tax-credit is a Government handout? We provide handouts to the most perverted farmers who grow the worst corn cultivar ever. Bailouts to banks $700 Billion, $4 Trillion lost by the Department of Defense and the Gulf War that's costed over $2 Trillion and people complain about a tax-credit that's been proven to help the poor by all credible economist.

What's wrong with providing the EIC?

I do agree with your summation of this tax prep business, when people are paid minimum wage like they use to when I thought about working for them for fun(early 1990s) until I realized you can make double working for Costco!

I considered working for them when I started out as a tax preparer, but at my interview I had more tax knowledge than most of their third years (I'd been doing my own taxes with schedule C for over a decade) and they offered me minimum wage! I started my own company. ;-). If there is absolutely no way you can go to an independent preparer, ask for a supervisor.
The IRS only cares that you report all income, they expect independent contractors to have more income than what is shown on their 1099s.

I do understand why they want proof of self-employment income. It is fairly well known in some parts of society just how much you need to make to maximize your EIC and if you have no job, many create 'dog walking' or 'baby sitting' or 'car washing' self employment that earns just that 'sweet spot' of self employment income with no documentable expenses so that their return will bring them the maximum handout. This poses problems for the tax preparer as they are supposed to be applying 'due diligence' and when neither proofs of receipt or expenses are presented, they need some way to CYA. They are unlikely to tell you that tax fraud prevention is why they need the paperwork, but I would suggest you take in your spreadsheet that shows income and reimbursements and such along with your mileage logs and if they still will not work with you, ask for their supervisor.

Independent contractors have to pay self-employment tax, since they don't automatically have social security taxes taken out. This is over and above any income tax and the rate is almost 16%. So yeah that would be pretty dumb of someone to fabricate income that they have to pay self employment taxes on because that would be much more than the earned income credit for people without dependents.