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If I do get hired I will be making 4800$ yearly. From what I read as a single person you are suppose to make 9800 to file taxes. However it also said if your an independent contractor you have to file for taxes. Yes I do not meet the minimum for a single person. If I get someone to hire me to do odd jobs do I have to file taxes?
| No | 2 | |
| Yes | 5 |
As long as you don't make over that certain amount you should be good with fed. Idk about your state.
You didn't mention your country/state/province.
But if you're in New Zealand, you will need to declare your income earned for the tax year by filling in an IR3 form.
If you are operating as a contractor to a company for example this can vary. For example if they paid your income tax on behalf of your company, you will need evidence of this when filling in the IR3 form to prevent the IRD taxing your income again.
If they do not do this, you will need to pay the taxes yourself.
If you are making contributions to your retirement scheme, these are tax exempt so it is important you have evidence of this too.
Please note these taxes include your ACC payments (National Accident insurance).
Also remember to make sure you claim back any GST taxes for expenses accrued for business purposes.
As an independent contractor you are still responsible for paying FICA, whether you make the minimum necessary to pay tax. Even if you don't make the minimum as an employee, it is a good idea to file or it will send up all kinds of red flags, and the IRS will watch you very closely, which could come back and bite you in the ass some time down the line.
If you are in the United States, and from the standard deduction you listed it sounds like you are, the answer is yes. Even if you don't meet the minimum for the regular income tax, you are subject to what is called "self employment tax". Self employment tax is your contribution to social security and Medicaid which comes out of everyone's pay check at a flat rate even if they don't make enough to pay taxes.
Normally, half is paid by the employee and half by the employer. But with the self employment tax, you are both, so you basically pay double. You can write the other half off as a business expense, but as you don't make enough to pay regular income tax in the first place, that is irrelevant. The total is 12%.
Depending on you exact situation, you may qualify for tax credits, or something that might offset or eliminate this. But you would need to speak to a tax professional about that.
Most people making as little as you are though would ignore the law and work "off the books". But if the person who is contracting you is claiming your contract on their taxes as a business expense, that might come back to bite you.