1099 Question

@2stepps wrote:

Also, there are shops that will pay you to have your taxes done. But I would get someone to double-check if you can get it done as a low-income earner. I am on disability and I can earn up to $8000 extra a year with the SS increase I don't know but I have never come close to that. I have never even gotten enough from one company to get a 1099. But I hear that it will be different this year if you have over $600 come in a month from different sources be it Venmo, Paypal, Cash app, They will have to send you a 1099 and if you are not registered as a business you can't deduct mileage or supplies for this year. I guess the IRS is really after the pennies of the poor instead of the megabucks of the wealthy.

Just an FYI: Usual for tax prep shops, they do have a minimum amount you expect to receive as a requirement. For example, must be getting at least $500 back to qualify for a shop etc

Create an Account or Log In

Membership is free. Simply choose your username, type in your email address, and choose a password. You immediately get full access to the forum.

More About Mystery Shopping Taxes

Can someone help with my question? Just got a 1099 for $1015 for the month of December. $400 of that was actually reimbursing me car washes. I would have never thought they would be keeping the reimbursements and the fees in the same pool. Is this up to me to prove or is this a mistake?

I was able to breakdown my 1099K from Paypal and tgey did not include any income that was sent from relatives however all my reimbursements are included as income for all MSCs that paid via Paypal.

The 1099K should be out there now. I got mine 4 days ago on the Paypal mobile app. If you click on your profile icon a dropdown should appear. You will find it under the "statements and taxes" link.

I totally understand that PayPal would not know or be able to separate this for you. My question is do you add all of the reimbursements to the schedule C or do you just straight up deduct those from the overall total.

My personal preference is to add in the reimbursements on Schedule C so that the total matches what Paypal has reported to the IRS. Then list the reimbursements as business expenses on the same Schedule C. There are some on this Forum who have traditionally not included reimbursement on Schedule C. That is a legal alternative, but that was before Paypal started sending totals (as required) to the IRS. I am curious to see how other respond to you

@jrj76 wrote:

I totally understand that PayPal would not know or be able to separate this for you. My question is do you add all of the reimbursements to the schedule C or do you just straight up deduct those from the overall total.

Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008

Based on the money going into my PayPal account I should receive a tax document, but the website tells me I have none available. I don't know if that means it will show up in a couple of days or something else.

Happiness is not a goal; it is a by-product. Eleanor Roosevelt

I think that I should have Tax Documents for 2021 also, but none are there.

Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008

@myst4au wrote:

My personal preference is to add in the reimbursements on Schedule C so that the total matches what Paypal has reported to the IRS. Then list the reimbursements as business expenses on the same Schedule C. There are some on this Forum who have traditionally not included reimbursement on Schedule C. That is a legal alternative, but that was before Paypal started sending totals (as required) to the IRS. I am curious to see how other respond to you
@jrj76 wrote:

I totally understand that PayPal would not know or be able to separate this for you. My question is do you add all of the reimbursements to the schedule C or do you just straight up deduct those from the overall total.

That is fair, but wouldn't the people who don't include it on the schedule c were they on the hook for the taxes for the reimbursements? Seems absolutely absurd to pay income taxes on the reimbursements and would shock me how people successfully make a full time income doing this if that would be the case.

As I understand that method, they only list the fees on Schedule C. IMHO, that leads to a discrepancy between the 1099 Form that the IRS received from PayPal or the MSC (some MSCs include reimbursements on the 1099 Form ) and again, IMHO, that increases the odds of the IRS asking questions which can easily be avoided by reporting the entire amount, and then deducting the reimbursements as business expenses.

@jrj76 wrote:

@myst4au wrote:

My personal preference is to add in the reimbursements on Schedule C so that the total matches what Paypal has reported to the IRS. Then list the reimbursements as business expenses on the same Schedule C. There are some on this Forum who have traditionally not included reimbursement on Schedule C. That is a legal alternative, but that was before Paypal started sending totals (as required) to the IRS. I am curious to see how other respond to you
@jrj76 wrote:

I totally understand that PayPal would not know or be able to separate this for you. My question is do you add all of the reimbursements to the schedule C or do you just straight up deduct those from the overall total.

That is fair, but wouldn't the people who don't include it on the schedule c were they on the hook for the taxes for the reimbursements? Seems absolutely absurd to pay income taxes on the reimbursements and would shock me how people successfully make a full time income doing this if that would be the case.

Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008

Paypal, Venmo, etc.

$600+ and any number of transactions 1099-K reporting is effective 1/1/2022.

$20,000+ and 200+ transactions 1099K reporting is for 2021 and years prior. If this applies to you, expect a 1099-K for 2021. If not, stop looking for one. :-)

What would people do who make a lot of money off of shops such as Jack in the Box. Those shops just give you one fee and do not specify they are even giving you a reimbursement. Do you add this on your own and then deduct?

@jrj76 wrote:

Can someone help with my question? Just got a 1099 for $1015 for the month of December. $400 of that was actually reimbursing me car washes. I would have never thought they would be keeping the reimbursements and the fees in the same pool. Is this up to me to prove or is this a mistake?

I think companies do it all kinds of ways. I've had 1099s both ways--including reimbursements and not. In my main field of work, most of my clients used to include reimbursed expenses.

You can go ahead and claim the $1015 as income and the $400 as expenses. The 1099 doesn't get sent in with your return, and this is a perfectly legitimate way of itemizing income and expenses. Some people claim income as just the fees, not including reimbursement; some claim 100% of the incoming cash flow, then offset it with the expenses. I do the latter, but others do the former. As has been mentioned here, if your claimed income matches your 1099s, that probably makes the most sense. Either way, you're claiming $615 as income. Just keep your receipts!

I learn something new every day, but not everyday!
I've learned to never trust spell-check or my phone's auto-fill feature.

Edited 1 time(s). Last edit at 02/02/2022 06:56PM by BirdyC.

I've always listed every penny of income, then deducted out every penny of expenses.
The IRS audited my 2015 returns and after LOTS of time spent photocopying receipts they sent me a letter saying no changes were needed, have a nice day.
Save every receipt, keep YOUR OWN detailed records. DO NOT RELY ON PAYPAL OR A MSC to keep records for you.
It does not matter if you make $25 or $25k or $250k you are responsible for reporting that income! Keep detailed mileage logs. Deduct your mileage, required purchases, meals while on a route, hotel expenses, cell phone bills, etc. Just save every dang receipt.

Sorry, only registered users may post in this forum.

Click here to login

1099 Question

Create an Account or Log In

Official List of Mystery Shopping Companies

Mystery Shopper Magazine