New 1099 "loan" situation

[ChEAr$]

All in all

THEY call it a "loan" and maybe it's as simple as that. Should I just "call" it and tell them the 1099 is in error? I hate to drag y'all into my campout with this stupid stuff.

one thing is clear. And that is "form over substance."

By working for the "employer", client is performing services and receiving a S A L A R Y! This is taxable income and of course should be on a W2 form. After all, employer intends to deduct the payment as a business expense since he issued a 1099.

If client can't get satisfaction from employer and a proper W2 form, he has to decide what to do. After all, you and I are not in the practice of law (thank GOD!) so shouldn't be interpreting that amazingly convoluted agreement.

One route I would advise, if client can't or won't resolve it with employer is to report it all on line 7, use the form provided to also pay 1/2 of FICA.

BTW, you reckon these two guys are related?

[Possi]

I feel your pain

one thing is clear. And that is "form over substance."

By working for the "employer", client is performing services and receiving a S A L A R Y! This is taxable income and of course should be on a W2 form. After all, employer intends to deduct the payment as a business expense since he issued a 1099.

If client can't get satisfaction from employer and a proper W2 form, he has to decide what to do. After all, you and I are not in the practice of law (thank GOD!) so shouldn't be interpreting that amazingly convoluted agreement.

One route I would advise, if client can't or won't resolve it with employer is to report it all on line 7, use the form provided to also pay 1/2 of FICA.

BTW, you reckon these two guys are related?

If he worked for the man that was paying him, there would not be a question. He is not. I should not have called him the "boss" because he is not.
He is another person in this elite profession. There are very few of these specialists in the US. He simply wants my client to make the team. My client does not work for this man.

[Burke]

Well, let's hope that both of them are "gentlemen," and will listen to your advice. I would talk with both of them and tell them the following:

1. A "loan" at 0% does not fly with the IRS. They will require imputed interest to treat it as such.
2. Get a new agreement. It is obvious no lawyer drew this one up. And as written, it is so contradictory that it may be unenforceable.
3. Find out from each what their actual intent was (is). (Why was the 1099 issued.)

[Davc]

2. Get a new agreement. It is obvious no lawyer drew this one up. And as written, it is so contradictory that it may be unenforceable.

I find your faith in the legal profession touching, but naive.

[Burke]

Well, I don't like to disparage any professional..... but I understand perfectly. And I have seen some legal whoppers, too.