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I found out this year that sometimes he gets a W2, but he's been putting that info in as a 1099-MISC instead of as a W2.

He's overpaying Social Security & Medicare tax, plus the IRS is gonna wanna know where the wages that were supposed to be reported are hiding. W-2 wages go on line 7 of the 1040. Independent contractor receipts go on Schedule C.

He needs to amend 2007-09 if they had this error.

Meanwhile, let's talk mileage. Allowable mileage related to W-2 income is a Schedule A miscellaneous itemized deduction, not a Schedule C deduction. There's a broader issue about what is and isn't deductible mileage. IMO he needs to sit down and talk with an accountant experienced with industry issues.

While there he should disucss the biggest issue, employee (W-2) vs. independent contractor (1099).

Rule Your Retirement Home Fool
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