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Day 13: What to Know About 1099-NEC & Contractors: A Simple Guide for Businesses and Freelancers

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🧾 Day 13: What to Know About 1099-NEC & Contractors: A Simple Guide for Businesses and Freelancers In today’s flexible work landscape, hiring independent contractors can be a smart move—offering agility without the long-term commitments of traditional employment. But with this freedom comes responsibility, especially when it’s time to tackle tax forms like the 1099-NEC . Let’s break down what you need to know about using this form and working with contractors, without the tax jargon overload. πŸ“Œ What Is the 1099-NEC? The 1099-NEC (Nonemployee Compensation) is an IRS form used to report payments made to nonemployees for services. It replaced the old use of Form 1099-MISC for service payments starting in 2020 . You’ll need to issue this form if you paid: $600 or more in the calendar year To an individual or business not classified as an employee For services (not products or rent) Who is not incorporated—i.e., a sole proprietor or LLC taxed as such It goes to both t...
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πŸ“† Day 11: The Home Office Deduction — Who Really Qualifies?

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 πŸ“† Day 11: The Home Office Deduction — Who Really Qualifies? In today's increasingly remote landscape, the home office deduction has gained more attention than ever. But while many dream of writing off their cozy corner desk and coffee machine, the IRS has pretty clear boundaries on who actually qualifies. Let’s break it down with precision, so you know where you stand and what’s deductible. 🏑 What Is the Home Office Deduction? The home office deduction lets self-employed individuals claim business use of part of their home, potentially reducing their taxable income. It’s a legitimate tax benefit designed to support those running their own operations—from freelancers and consultants to Etsy shop owners and digital product creators. Note: W-2 employees generally cannot claim this deduction, even if working remotely for an employer. ✅ Who Qualifies? To qualify, your home office must meet two key criteria : Exclusive and Regular Use The space must be used solely for busin...
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