1099-MISC in box 7 not box 3

[BLACK BART]

On ‎2‎/‎27‎/‎2017 at 9:40 AM, Catherine said:

Client helped out her sister-in-law briefly while s-i-l was swamped at her office.  Did some filing and copying, basically office grunt work.  NOT in the business of hiring herself out as temporary office help.  S-i-l gave her a 1099-MISC (rightly) with total in Box 7.  Except to my thinking it should have been Box 3, and not subject to SE tax.  

I'm thinking I need to do a C-EZ, show the 1099, back it off, and then show on Line 21.  Yes?  No?  Other?  I'm starting to over-think this one - stop me!

http://www.bradfordtaxinstitute.com/Endnotes/TC_Memo_1992-727.pdf

Unless it's an amount they can't stand, I'll generally go with the C-EZ since attempting to get anybody to change a 1099 or issue a W-2 instead is on the order of trying to achieve world peace.  But here's something from "way back in the nineties" (John A. Batok, Tax Court Memo, 1992-727) that shores up your position.

And, after all, would I dare argue with the enlightened entity who's familiar with "the singularities of X"?  Certainly not! And I would've bet a hundred bucks nobody could answer that dang thing I stole from a mathematics site. How'd you do it ?

        

 

[RitaB]

8 minutes ago, BLACK BART said:

http://www.bradfordtaxinstitute.com/Endnotes/TC_Memo_1992-727.pdf

Unless it's an amount they can't stand, I'll generally go with the C-EZ since attempting to get anybody to change a 1099 or issue a W-2 instead is on the order of trying to achieve world peace.  But here's something from "way back in the nineties" (John A. Batok, Tax Court Memo, 1992-727) that shores up your position.

Do you wonder if the guy coming back with $7,000 in business expenses for $4,000 in income helped them decide he wasn't in business?  Asking for a friend.

[Catherine]

2 hours ago, BLACK BART said:

And, after all, would I dare argue with the enlightened entity who's familiar with "the singularities of X"?  Certainly not! And I would've bet a hundred bucks nobody could answer that dang thing I stole from a mathematics site. How'd you do it ?

Quartic surfaces are super-cool but definitely weird (and some of the "simpler" ones look a whole lot like the descriptions of sub-atomic orbitals).  A few decades ago I *might* have been able to at least tackle the equations that define them.  So I side-stepped your entire statement by running for cover to the Planck limit, where all lengths lose locality.  

That's how:  by having a brain full of only loosely-related nerdly trivia.

[DANRVAN]

Obviously, W-2 should have been issued. There might be a case for line 21, but that could ultimately be decided by tax court, IRS will probably not buy it.

Ron mentioned the options to push it back to sister-in-law with SS-8 or 8919.

Sounds like client needs to be informed of all options and possible outcome of each as it is not a black and white case.

Has client addressed the situation to sister-in-law?  How much income are you dealing with.

[BLACK BART]

22 hours ago, RitaB said:

Do you wonder if the guy coming back with $7,000 in business expenses for $4,000 in income helped them decide he wasn't in business?  Asking for a friend.

I dunno - I never even read the details; just remembered it from an old seminar and the only thing that rang a bell was the court deciding it's NOT subject to SE.  Probably doesn't make much difference anyway though 'cause everybody's got a different outlook and IRS is not (I think) required to follow a TC memo.  They'd probably fight this stuff from trench to trench if the money was compelling.

20 hours ago, Catherine said:

...So I side-stepped your entire statement by running for cover to the Planck limit, where all lengths lose locality...

Oh...okay, yeah; I had forgotten all about those Planck length-losing localities. Now I've got it. Thanx.

2 hours ago, DANRVAN said:

...Ron mentioned the options to push it back to sister-in-law with SS-8 or 8919...

You guys have got guts; somebody would have to pull a gun to make me suggest confronting my sis-in-law with an SS-8....

[DANRVAN]

On ‎03‎/‎06‎/‎2017 at 3:57 PM, RitaB said:

Do you wonder if the guy coming back with $7,000 in business expenses for $4,000 in income helped them decide he wasn't in business?  Asking for a friend.

Tax court disallowed $5,000 as personal auto (commuting), the rest was unsubstantiated except for $120 in tools, which court recognized was not enough for to itemize on Schedule A.

[Catherine]

20 hours ago, BLACK BART said:

Oh...okay, yeah; I had forgotten all about those Planck length-losing localities. Now I've got it. Thanx.

It's actually pretty fascinating.  If you take a length of rope - say a foot.  Cut it in half, you have six inches of rope.  Cut it in half again, three inches.  And it *seems* like you can keep doing that ad infinitum - except you can't.  At the Planck length, whatever you are trying to divide LOSES any definitive location and instead is suddenly everywhere *in the universe* at once.  No locality.

Dr. Feinman once said of quantum physics that (and I am paraphrasing here) it is utterly preposterous and ludicrous, and in fact the *only* thing going for the entire field of study is that it is undoubtably true.

[Lion EA]

Nice explanation, Catherine.

[BLACK BART]

11 hours ago, Catherine said:

It's actually pretty fascinating.  If you take a length of rope - say a foot.  Cut it in half, you have six inches of rope.  Cut it in half again, three inches.  And it *seems* like you can keep doing that ad infinitum - except you can't.  At the Planck length, whatever you are trying to divide LOSES any definitive location and instead is suddenly everywhere *in the universe* at once.  No locality.

Dr. Feinman once said of quantum physics that (and I am paraphrasing here) it is utterly preposterous and ludicrous, and in fact the *only* thing going for the entire field of study is that it is undoubtably true.

 

7 hours ago, Lion EA said:

Nice explanation, Catherine.

Yes it was.  And quite impressive too.