How do I report independent contractor income?

[letswastemoney]

For example, I worked for ThoroBid for a short while, and earned $375 one month.

I don't have any special form stating that though, and I plan to use the online TurboTax to do this. Do they just trust me if I put down I earned that much through them?

[thaskalos]

I recommend that you take all the necessary precautions.

Send the $375 to me...and I'll gladly report the extra income on MY return.

[tucker6]

For example, I worked for ThoroBid for a short while, and earned $375 one month.

I don't have any special form stating that though, and I plan to use the online TurboTax to do this. Do they just trust me if I put down I earned that much through them?
You more than likely signed a form with ThoroBid that has your SS# or business EID# on it. ThoroBid may or may not generate a 1099 for you, but in order for them to deduct the expense you represent to them, they will certainly declare what you received to the govt using your ID#. As you know, all income must be reported whether it is by W-2, 1099, or nothing at all. Only W-2's get submitted anyway. So report the $375 because the IRS knows you collected it.

So yes, the reporting is done on trust (without backup docs), but don't bet against the IRS on this one.

[barn32]

If you don't pay the $375, the IRS will send a little man to your house to hound you until you do. That $375 is a lot of money to them, and I'm sure red flags have been set off all over the place. Plus, an entire team of investigators have been assigned to the little man to make sure he can track you down and collect the money.

[Sheesh, just forget about it. The IRS hasn't got the time, money or resources to worry about your $375. You're not even a blip on their radar screen.]

[tucker6]

If you don't pay the $375, the IRS will send a little man to your house to hound you until you do. That $375 is a lot of money to them, and I'm sure red flags have been set off all over the place. Plus, an entire team of investigators have been assigned to the little man to make sure he can track you down and collect the money.

[Sheesh, just forget about it. The IRS hasn't got the time, money or resources to worry about your $375. You're not even a blip on their radar screen.]
Why would anyone risk getting a letter from the IRS for back taxes, penalties, and interest for a $30 tax bill (if that)? The OP likely has to file a return regardless, so why not be honest for the little sum we're talking about?? Risk/reward scenario. 90% chance they don't find out about the $30 tax not paid, but there is a 10% chance that you'll pay $500 in tax, penalty, and interest.

[alydar]

Most likely you will not get a 1099 as your payments from them were less than $600. Nevertheless, you should report this as income, on Schedule C. You may have some deductions, expenses you incurred to get that income that you can partially offset the earnings.

[davew]

and you get to pay all the social security imstead of half

[iceknight]

Most likely you will not get a 1099 as your payments from them were less than $600. Nevertheless, you should report this as income, on Schedule C. You may have some deductions, expenses you incurred to get that income that you can partially offset the earnings.I vote this as the best answer. Be careful with deductions, don't go wild with them, but do justifiable deductions for which you have records/receipts. For those who are interested in odds, here is an interesting article from last year (Forbes link (http://www.forbes.com/sites/anthonynitti/2013/03/25/what-are-your-odds-of-being-audited-by-the-irs/)).

[JustRalph]

Forgiveness rather than permission