IRS Question?

I worked in a war zone for 300 days. I lost my job at no fault of my own, was forced to come home and be unemployed. I couldn't claim unemployment insurance because the company I worked for was based out of a different state than I lived. As a result, I had to live off of the money I saved for taxes. What will the IRS do? It was 1099. How much taxes will be owed on 70k? And I did form a business for write offs, but never had a chance to open another bank account with the EID? What can I do? Thank you. Thanks guys. Yeah, they tried to say we are 1099, but we wore uniforms, and had to work on their schedule. They did it to save money. I will give the IRS a call. Thank you. So, it looks like best case I will owe around 15k, if I can make the claim I was an employee. What if I only have 7k to pay the IRS? What will the IRS do?

Public Comments

1. 1. Call the IRS and talk to the small business department as to whether your were an employee or an independent contractor. You called this a job which is normally a W-2 and covered by unemployment. The payer is giving you a 1099, saying it wasn't a job, but a contract and they didn't withhold anything. The IRS has very specific points that have to be met to be a contractor. Blackwater is calling their employees contractors and the employees are winning the argument by using the SS-8 form. 2. With a confirmed SS-8 form, you would owe only your share of FICA taxes (7.65%) instead of both shares (15.3%). The difference is probably $4000 in tax. 3. As for income tax. $70K - single = $61250 (assuming the SS-8 holds, you started work on 1/1 and had no other job) or about $11,000 in tax. So the total is probably $15K if you are an employee. $19K if you are a contractor. The calculation changes if you had other income or if you had deductible expenses.
2. It does not appear as though you qualify for the foreign earned income exclusion, as you fall 30 days short of the minimum. Assuming your business is a sole proprietorship, you can still deduct your business expenses in order to arrive at your net profit. Self-employment tax on your net profit will be 14.1%. Your regular income tax will probably be in the 15% bracket, although you really don't provide enough details to determine that. Such factors as filing status, dependents, itemized deductions, etc. come into play.