What’s the difference between a 1099 and W-2?
Regarding the difference between a 1099 and W-2, if you received a W-2, you’re considered an employee. A W-2 reports these:
- Wages, tips, and other compensation paid to an employee
- The employee’s income and Social Security taxes withheld and other information
- Wage information to the employee and the Social Security Administration
You should report the information on the W-2 under wages.
If you received a Form 1099-MISC, you’re considered an independent contractor.
Form 1099 reports payments made in a trade or business to either of these:
- A person who isn’t an employee
- An unincorporated business
This form is required when payments of either of these are made:
- $10 or more in gross royalties
- $600 or more in rents or compensation
Do you have to report amounts from Form 1099-R as income on your taxes? Learn more from the tax experts at H&R Block.
Learn more about Letter 1616, why you received it, and how to handle a substitute for return notice with help from the tax experts at H&R Block.
If you are questioning “Why is my tax return so low?”, let the H&R Block tax experts explain what is affecting your refund. Learn more.