Being contract can have it's ups and it's downs. When you are a 1099 contractor, you can deduct millage as well as business meals, home office expense, but in order for them to be worth while your expenses would have to be more than your standard deduction which in my case it wasn't when I was a contractor. If you need to cover this cost, you may need to think about charging more. That's one reason why contractors are expensive.
Good luck.
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Question
Submitted 355 days ago...
Expenses included in paycheck
Hi,
I am a contract employee with a Co. that have not (will not)seperate my mileage reimbursement/expenses from my payroll check.
(Expenses are included on my paycheck)
They think if they are audited, there would be a fine for paying a contract employee mileage reimbursement/expenses.
My problem: Is there anyway I can exclude the expense amount from my 1099 providing detailed documentation of expenses and a letter from the Co. I work for confirming this?
I am concerned of course because I am paying taxes on the total amount on my 1099.
Please Help!
Thank you
Darcy
Answers
Answer 1 / 2
Submitted 355 days ago...
Good for you for keeping records, you should be able to deduct mileage from your 1099. The IRS currently allows you to deduct 48.5 cents per mile for business miles driven, (2007).
Saving all your receipts (for everything, even if it's less than a dollar!) is so important. You might also consider having a tax accountant file your taxes. They can provide additional guidance if you need it.
If you decide to hire a CPA, it helps them work quicker if you organize and summarize your receipts beforehand.
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