Doing your taxes when you’re an Independent Contractor

As a mystery shopper, you are officially classified as an Independent Contractor for federal income tax purposes.  This article by Shannon Scarberry of  IntelliShop offers tips for doing your taxes when that time comes around:

* You are responsible for filing your own taxes each year. The mystery shopping company you work for will mail you a 1099 form to indicate how much money you made with them. You probably won’t receive this form if you made less than $600 for the year, however. “Income” includes all the fees you were paid and may include reimbursements for your expenses.

* You may be able to deduct some of your mystery shopping expenses that weren’t reimbursed, including mileage, car expenses including gas, postage costs, and a share of your internet bill, etc. You may be able to deduct some of the expenses of your home if your home is your primary office. Independent contractors file a Schedule C to claim business expenses.

* If your mystery shopping pay approaches the pay of a full-time employee, you may want to make quarterly federal income tax payments so that you won’t have to pay in all at once at the end of a tax year.

 

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