Guidelines for Reporting Cash Income Without a 1099 Form
If you are a freelancer, most of your clients may pay you using cash. Therefore, it is wise you learn how to report the cash income to avoid problems with the IRS. The person or company you worked for should send you a 1099 form to use for filling your income. You may assume that it is impossible to file your taxes when you don’t have the 1099 form. You should thus find an online platform that will educate you more on how the 1099 form works. Read more now to see the tips to assist you on how to report cash income without a 1099 form.
You should know that the 1099 form is only issued for payments that exceed $600. Thus, if you receive a cash payment below this amount, you don’t need to fill the 1099 form. It may be necessary to request the client for the 1099 form if you receive a payment that is greater than $600. Understand that this form may be lost in the mailing process, and you won’t know if you don’t follow up with the client. Thus, even if you don’t have the 1099 form, it is wise you have a record of the request when filing your income tax.
If you get paid cash less than $600, you need to learn how to handle this income when filing your tax. You are legally required to report all the money you earn, even the small amounts you get as a freelancer. It is therefore wise you find reliable tools for recording all your incomes. To ease your work, you should opt to use a spreadsheet or accounting software to record all the cash incomes you get. The key thing is to ensure that you include all money you have earned as a freelancer. You can therefore present this record to IRS during auditing to show you pay all your taxes. Hence, you need to ensure you have an accurate record of all your cash earnings.
You also need to know the deadline for reporting the cash income. The deadline is April 15, but you have the option to file for an extension. It is, however, wise to know the extension is on submitting the returns and not the tax payment. You, therefore, pay your taxes on time without having to send the 1099 form on the April 15 deadline. Hence, you need to have a record that will help you calculate the taxes to pay.
Hence, the above tips target to make it simple to know how to report a cash income without a 1099 form. You should also search for the top website where you can create the 1099 form yourself.