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Taxes 1099

Quick question to yall. I have 1 venue that gives me a 1099. Just came from H&R block. Because of the 1099 I have to pay my portion of the tax but then I as the self employer must again match that tax. I am thinking about saying adios to this venue. Whats your take on it. How many venues do 1099's I have only the one. Interested in what yall think
7 REPLIES 7
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Re: Taxes 1099

plus it costs to file the schedule C
Joelheck
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Jul 16, 2007

Re: Taxes 1099

Most gigs I play nowadays, issue 1099's. $600 and over they are required to issue them. It depends on who does your tax return and whether they are knowledgeable at reviewing your expenses.

I learned from one accountant, then went to using Turbo Tax Home and Business, which does a pretty good job of prompting you through most of the earnings and valid deductions/expenses. Yes you need to keep accurate records of mileage, tolls, new equipment and expenses like music, music services, supplies, business cards, posters, even your website and guitar strings.

I played a while at the same place for 3 years, 3 nights a week, along with several other 1099 venues. My 1099's were up there, but I managed to buy a new car, guitar and an additional Bose. All cash. Nice money, but the IRS was my partner and got their share, minus the expenses. It's just the cost of doing business around here.

I had a friend years back that played for cash under the table so to speak. A popular rip that the musicians union warned us about years ago, was someone wanting your gig turns you into the IRS. Well he got caught in it and got audited. The penalties were pretty expensive.

I guess it depends on how many gigs your playing and if its worth the risk.
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Re: Taxes 1099

good points
AJ CASALI
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Mar 10, 2020

Re: Taxes 1099

Hi

I, like Joel, play gigs that send 1099's and also use Turbo tax Home and Business. Just keep track of all your expenses and pay the IRS their share. I found out real fast that it's easier to pay Uncle Sam then not to. IRS agents "eat their young" so to speak so we "musicians are just a snack". Pay up and sleep well at night. Smile
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Re: Taxes 1099

thanks
Oldghm
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May 25, 2004

Re: Taxes 1099

gary10113 posted:
Quick question to yall. I have 1 venue that gives me a 1099. Just came from H&R block. Because of the 1099 I have to pay my portion of the tax but then I as the self employer must again match that tax. I am thinking about saying adios to this venue. Whats your take on it. How many venues do 1099's I have only the one. Interested in what yall think

I think the matching part that you speak of is paying the full amount of FICA withholding, or Social Security, over and above your income tax liability. For the self employed, FICA amounts to about 15 cents of every dollar earned, up to almost $130,000. That's something to keep in mind when pricing gigs, or new cars, if you expect to pay for them with your earnings from music. 

Social Security and Medicare Withholding Rates

The current tax rate for social security is 6.2% for the employer and 6.2% for the employee, or 12.4% total. The current rate for Medicare is 1.45% for the employer and 1.45% for the employee, or 2.9% total.

Coming from someone who has been 100% self employed since the early 70's and is now looking to draw from that withering Social Security pot, don't cheat too much, but if you do, save it. 

And remember, you're helping to support a bunch of old guys (and gals) like me.

O..

BanjoJames
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Nov 18, 2006

Re: Taxes 1099

Typically, once you start earning over $600 from a venue, (or even band) they can send you a nice 1099, and the same will be reported to the IRS. It's a business expense for them and earnings to you.