OT Exemption from 1099-NEC

[Snaggletooth]

The language mentioned from the overtime exemption includes overtime from 1099s as well as employees.

I find this quite improbable, if the recipient is a bona fide contractor instead of an employee. Could this be supported by a payment of more than forty hours in a given week.

I am a self-employed person billing in some cases with a time sheet for my larger customers. I rarely work more than forty hours for a single customer, and even if this happens, I do not charge overtime premium.

Comments??

[terryats]

A lot of drivers using own auto for pickup services receive tips, and a 1099nec. As I understand the service will let them know how much income was tips.

[spanel]

Tips would be a lot easier and also only some categories quality anyway.

My understanding that self employed may not qualify for OT? How on earth could you prove OT for a self employed individual??

Chris

[terryats]

I agree with Spanel, as overtime would be very unusual for self employed. I have never seen it.

[spanel]

I do know that qualifying OT has to meet the FLSA requirements, which would exclude

Any overtime paid for work less than 40 hours in a 7 day period (over 8 hours in a day, weekends, holidays)

Also, if an employee worked over 40 in a 7 day period and was paid more than 1.5x, you have to reduce it to 1.5x.

Example $20/hr normal pay ($30 1.5x OT) @ 100hr OT = $3000. The tax credit would be listed as $1000 (only the .5x/premium) or $3000/3
Example $20/hr normal pay ($40 2.0x OT) @ 100hr OT = $4000. The tax credit would be listed as $1000 (only the .5x/premium) or $4000/4


Chris