Contract Questions

[VulgarDragon]

I am going to do some commission work and was given a contract (or agreement) for me to sign. I noticed that I'm supposed to enter my social security number, among other personal information like phone number, email....is that normal? Just not sure about giving out my social security number.

[Mirana]

The employer needs a tax ID number from you to file a 1099 form at the end of the yr (although they are only required if it's above about $600 that they're paying you, it doesn't mean they can't--or shouldn't--otherwise). If you do not have a business ID number, then they have to get your SS# (there's even a form on the irs gov site that they can send you to get this info).

When you do your taxes this coming yr you can apply for a business ID (it's free!) to give out in the future.

Personal info like a phone # and email is certainly standard...they have to be able to contact you and not just send money into a void. ;)

[DeadlyFreeze]

As Mirana said its all normal, I would only be weary if you got it off craigslist or something similar. If that was the case you need to do some digging before you hand out your SS ID.

[aesir]

Yea, you need to give them that info on a tax form.

[arttorney]

You can apply for the tax ID number on the IRS website too.

Since they will apparently 1099 you, you will definitely have to report the income. Regrettably the IRS keeps track of their own records.

You would think if the government was going to be incompetent this would be one of the nicer areas for them to do so, but no!

[Mirana]

It should also be mentioned that paying taxes on freelance income is tricky, tricky business so you should definitely do some research into it if you're going to be doing this all the time. The first yr you do freelance you just have to pay in April a lump sum, the next yr if you plan on doing freelance you need to pay your taxes in quarterly installments...based on the income you made last yr. However, there are special cases if your W-2 payments from a day job would cover your freelancing taxes......

Very complicated and annoying. Do a little research and perhaps invest in tax software to ease the headache. :/

[arttorney]

You will grow to hate Schedule SE.

[VulgarDragon]

Ouch. I was hoping to avoid that, at least until it becomes regular income. I know squat about taxes.

[Mirana]

Hah, the govt doesn't care if it's regular! They just want their cut! ;) You'll know if you need to report it for sure if you get a 1099 at the beginning of next yr.

Tax software is good, but it is possible to figure it all out just using the booklets and forms on the irs site. Tedious, but possible.