Dr. Friday explains the importance of accurately reporting all income, even if you don’t receive a 1099 form for every payment. Underreporting income is a major audit trigger with significant penalties. Learn how to stay compliant and avoid common mistakes that could lead to trouble with the IRS.
Transcript:
G’day, I’m Dr. Friday, President of Dr. Friday’s Tax and Financial Fund. To get more info, go to www.drfriday.com.
This is a one-minute moment. Very soon you’re going to start receiving your tax forms, and one of them is probably going to be, if you’re self-employed, a 1099. A little bit of information. If someone does not give you a 1099, does not mean you’re not supposed to report that income. It doesn’t mean that all you do is report what you’ve received on 1099s. Most businesses will not receive 100% of their income in 1099s. Some do. But your job is to report every dollar that has went through your bank or that you’ve collected. If it’s cash, then you collected it that way. Make sure you report all of your income. One of the biggest things we’re getting audited on is people under-reporting income, and that penalty can be huge.
Need help? Go to drfriday.com. You can catch the Dr. Friday Call-In Show live every Saturday afternoon from 2 to 3 p.m. We’re live every Saturday. right here on 99.7 WTN.