Home Improvement Contractor - Licensed Contractors

As an Independent contractor or business owner what is the max amount of payment that can be received in any?

As an Independent contractor or business owner what is the max amount of payment (in any form) that can be received before you have to claim, or file when it comes to tax season.

Public Comments

1. There is no maximum. The sky is the limit. However, if self employment income totals at least $400.00, you are obligated to report it on schedule C. Self-employed individuals, sole-proprietors, independent contractors and persons who have net earnings of $400 or more are required to pay self-employment tax by filing Schedule SE, attached to their Form 1040, U.S. Individual Income Tax Return. Employees of a church that receive income of $108.28 or more, but do not receive a Form W-2 for the earnings must also pay self-employment tax by filing a Schedule SE, attached to Form 1040, U.S. Individual Income Tax Return. As a self-employed individual (someone who owns an unincorporated business) or an independent contractor, you are required to report income and expenses on a Schedule C (PDF) or C-EZ (PDF). Your net profit may be subject to SE tax. You must file a completed Schedule SE attached to your Form 1040, U.S. Individual Income Tax Return. As a member of a partnership that carries on a trade or business, or as a member of a Limited Liability Company (LLC) that chooses to be treated as a partnership, your distributive share of its income or loss from that trade or business is included in your net earning from self-employment. These entities must report the business income and expenses on Form 1065, U.S. Return of Partnership Income, along with a Schedule K-1 reporting each partner's net income or loss. You must file a completed Schedule SE attached to your Form 1040, U.S. Individual Income Tax Return.
2. 49 cents. At 50 cents, it rounds up to the next dollar. If you have a regular job and then have contracting work on the side, even $1 can cause you to owe more in taxes. If you only have contract work and your total for the year is less than $400, then you don't have to file. The urban myth arises from the fact that your payer is required to send the IRS a 1099-Misc when they pay you $600 or more. (Many payers issue them for all amounts.) Some taxpayers get the bright idea that if the IRS doesn't know about the income, they don't have to claim it. This burns them terribly in audits, getting credit and when they go to retire. Even if it's your only income, schedule C kicks in if you have $400 or more of net earnings, since that's the point at which you can begin to owe Self-employment tax.
3. If you have other taxable income, $1. If it's your ONLY income then the most you can receive without having to file a tax return and possibly pay taxes is $400.