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  1. #1
    Join Date
    Jan 2009

    Question Independent Contractor Received W-2 Instead of 1099

    State: New Jersey

    I apologize in advance for my lengthy post, but I wanted to provide as much information as I could reguarding my situation. Thanks in advance for everyones help / input!

    I am a freelance Piano player who has been working for many schools / towns as a Musical Director for musical theatre productions. Usually, I got hired as an independant contractor and hire my own musicians. I get paid with a 1099-MISC for the entire music budget, and then I pay the musicians out of that budget and issue the appropriate 1099s to them.

    Issue #1:
    Last year I worked for a school that refused after the musical was done and closed, to pay me on a 1099. They said they only pay individuals on W-2s. After a long drawn out argument, to avoid anymore time delays (My musicians wanted to get paid!), they paid me the entire amount on a W-2.

    Now being unfamiliar with with how to pay my musicians out of a budget received on a W-2 form, I paid them 'under the table'. I assume(d) that all that would mean to me is that when I fill out my 1040 this year, I just claim the whole amount like a regular salary job, not deducting any money paid to my musicans from that. In retrospect, I should've seeked advice on the matter. Did I do something wrong, and at this point is there anything I can do to fix it (if nessecary).

    Issue #2:
    Despite the trouble I had with them last year, I have been asked to be the Musical Director for another one of their productions. For personal reasons, I would like to go back, provided we can reach an agreement on payment this year. The business manager for the school refuses to meet with me, and refuses to change his position on 'individuals only get paid on W-2s'. How should I go about getting it corrected? Should I file a SS-8 form, and get the IRS involved? Please advise.

    Thanks in advance for everyone's help!

  2. #2
    Join Date
    Oct 2006

    Default Re: Independent Contractor Received W-2 Instead of 1099

    Just report the W2 in the normal manner and report the money that you paid the other muscians on your schedule C. (1099s if appropriate) it will still balance out.

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