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  1. Oh, never mind, I think. I went ahead and put the income from the Vendor Agreement on Schedule C and filled out the Schedule SE (in my tax software). As it turns out, I was already over the limit for Social Security (I had employee wages of $126K last year). So, the only tax calculated on the Schedule SE is the 2.9% Medicare tax, and I apparently get a deduction for half of it on my 1040. The revised numbers don't change my federal return much, and instead of owing $160 for state tax (California), the software now says I get a $272 refund from California. I'm not sure how that works, but it looks like going the Schedule C/Schedule SE route might be better anyway, since I was already over the Social Security limit through my regular jobs. I didn't realize this pretty much makes the whole thing a moot point. Thanks again.
  2. Also, I noticed on page 1 of the instructions for Schedule C, it says "An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business." I'm thinking my situation falls more into the "sporadic activity" category than it meets the above definition of what qualifies as a business. Again, I need an expert opinion on this from someone who has experience with how these arguments play out in practice. Thanks much.
  3. Let me reiterate that I did not enter into the vendor agreement in order to conduct a business. I was involuntarily terminated from my job. They gave me a lump sum payment at the time of termination (2 months pay, with all federal and state taxes deducted). They then gave me the vendor agreement as part of the severance package, so that I would be on the hook for 6 months to answer any questions if they had any. I had no intention of doing this as an activity for profit. I basically was put into the situation (by being terminated) and then as part of a severance agreement, was given the Vendor Agreement. The Vendor Agreement was part of the severance package. I'm not trying to avoid paying income tax on the monies received under the vendor agreement. I'm just having a hard time seeing that I should pay self-employment taxes when I had no intention of being self-employed, had never been self-employed before, and have no intention of ever being self-employed. This was not a self-employment situation, but instead was pay following termination with the provision that I stay on the hook to answer any questions the former employer might have for the 6-month period. I've read as much as I can find on the IRS website about this situation, but it's still not clear to me how the rules apply to my situation. I'm wondering if anyone knows of any case law which might address a situation such as this. Thank you for your help.
  4. I worked for a company from February 2012 until they involuntarily terminated me in December 2013. As part of the severance package provided to me upon my termination, the company and I entered into a "Vendor Agreement", which basically required that I be available by phone or email to answer questions related to my previous job. In return, for a 6-month period following my termination, I would be paid a fixed sum on the first and fifteenth of each month. I was paid whether I actually was called upon to answer any questions. In actuality, I did very little to earn what I was paid over the 6-month period. I participated in a few conference calls to discuss matters I was previously involved with while employed, and I answered a few questions by phone and email. I never saw anyone from the company during the 6-month period, and I felt like I barely did anything to receive the money I was paid. Basically, I felt like the 6-months of payments under the Vendor Agreement were basically additional severance compensation, with the benefit to the company that they could expect me to be available to answer any questions they might have. My question involves tax treatment of the payments I received during the 6-month period of the Vendor agreement. No taxes (federal or state) were deducted from the Vendor Agreement payments. In researching how to report these payments for tax purposes, my belief is that I should report these payments on line 21 of Form 1040 (other income), not on a Schedule C as self-employment income (and therefore subject to self-employment taxes). I have never filed a Schedule C, I have never been in business for myself, and I have never received a 1099 before (and don't expect to again). I have been a full-time "employee" for the entire 30-year span of my career, and have never considered myself in business for myself. And I didn't consider myself in business for myself while I was receiving the vendor payments. During the 6-month period, I continued to actively seek full-time employment. In fact, 3 months into the term of the Vendor Agreement, I secured a new full-time permanent position as an employee of another company. I continued to receive the vendor payments for the remaining 3 months of the Vendor Agreement term, although I did nothing to earn them other than answer a few questions by phone and email. Am I correct in my belief that the payments I received are properly treated as "other income", and not as self-employment earnings subject to self-employment tax?
  5. I moved from Texas to California in October 2013 for a new position with my current employer. My employer paid for the move. That job did not work out, and I was involuntarily terminated December 31, 2013 (after only 2 months). Finding myself stranded in California with no job, I decided to move back to Texas. I moved back to Texas on March 4, 2014. I paid for the move back to Texas myself. I had no job waiting for me in Texas, but I started actively searching as soon as I got back to Texas. No sooner had I unpacked, I got a job offer from a new employer in California, who I had interviewed with before I moved back to Texas (they initially told me they selected another candidate, but he wound up not taking the job). I moved back to California to take the new job on April 1, 2014. I am still at the new job as of January 2015. To reiterate, employers paid for both moves to California. I paid for the move back to Texas. Since I was only in Texas for 3 weeks, can I deduct the cost of the move back to Texas on my federal tax return as Moving Expenses?
  6. I was told that a background check was going to be done. I was asked to provide my home address, my previous home address (since I just moved from Texas), my date of birth, and my social security number. My boss told me I needed to give them this information so they could do their background check, or it would cause problems for the audit engagement. I provided the information, but I did not necessarily say I consented to it being done. I was pretty much just told this is the way it had to be.
  7. I live in California. I have worked for the same company for 5 years. In August 2013, they promoted me to a new position and relocated me from Texas to California. The relocation was required for the new position. Subsequently, our outside audit firm said they needed to do a background check on me, because they have a policy of performing background checks on persons in management positions such as mine. I don't know if my employer had ever conducted a background check on me. If they did, they did not discuss it with me. The outside audit firm said they did not need my consent for them to do a background check on me, because they were not investigating or reporting credit information. So, they did their check, and they found 4 misdemeanor convictions from several years ago. They disclosed this information to my employer, who subsequently told me that they were letting me go. Are there any restrictions on third parties conducting background searches and disclosing the results to my employer? Or can anyone just go around conducting background checks on whoever they want to, and providing the results to people's employers without their consent? My employer is working out a severance package with me, in exchange for me agreeing to not sue them for anything. I am curious whether I have any claim against the outside audit firm who in effect got me fired from my job?
  8. I live in California. I have a criminal background. I have worked for my company for 2 years, and I don't know if they ever did a background check on me. If they did, they didn't say anything to me about what they found, and I am still working here. Our company is a privately held company, but we choose to have an annual financial statement audit by a big public accounting firm. I was recently promoted to a position which interacts heavily with the auditors. The auditors have told me it is their policy to conduct background checks of anyone in my position. It is not my employer who is insisting on the background check, but instead it is our auditors. I don't want to let them do a background check for obvious reasons, and I am afraid they would tell me employer if they found anything about me having a criminal background. Is there anything I can do to avoid this or to protect myself? I am sure if the auditors go to my boss and tell him I am not cooperating with them doing their background check, it is going to be trouble for me.
  9. My employer offered me a new position which required me to move from Texas to California. After moving out of my house in Texas and starting the trip to California, I fell off of the moving truck and sustained an injury to my shoulder, requiring a trip to the emergency room, followed by weeks of pain. Because I was injured in an activity which was a condition of my employment in the new position, am I covered by Workers Comp?
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