1099 on H1b

A

anjalee

New Member
I am working for a company on H1b visa and getting W2 income from there.
Recently I applied for concurrent H1b to work part time for another company and recd 1099 income for 4 months from there. My question to all is

Is it legal to obtain 1099 while on H1 or should I ask them to give W2 too?

What can be consequences?

I have filled for extension on my taxes just coz I was not sure about this 1099 things and my accountant is also not sure.

PLEASE HELP....
 
Re Concurrent Work

(1) Your Concurrent H1b Should be approved before you file taxes on 1099. It should not be in applied state. You did right thing to extend your taxes It better to pay with penalty.

(2) Your work hours should not exceed what were stated on concurrent h1b

(3) Since your concurrent h1b is not approved getting salary on W2 would be illegal (if it more than $500 per year) and you will complicate things.

(4) 1099 will be better choice. Somebody needs to pay taxes on 1099 to IRS.
Either "you" or "The Company" can pay taxes on 1099. If Concurrent H1b does not get approved You need to talk to CPA (Accountant) and Immigration Lawyer to get you out of this mess.
 
By law if you are on h1b, then you are an 'employee' meaning you could only get W-2's. 1099's are for independent contractors who report on Schedule C "Net Profit or Loss from Business". Its bettter you get 1099 cancelled in your name, you might face problems in future for accepting 1099.
 
(1) 1099 is for contractors that is true but you can do part time contracting on concurrent H1B provided it is approved but in your case it is applied. That complicates the things. A full time H1b should be always on W2.

(2) (a) Taxes on W2

Taxes on W2 = Tax paid by Company(SSN,....) + Tax Paid by You at Year End

(3) Taxes on 1099 can be paid in 2 ways
(3a) 100% by You
(3b) 100% by the company

(4) Problem in your case is you can't use (2) to pay tax since you don't have a approved concurrent H1B. Now you probably can't use (3a) since you applied for concurrent h1B but not approved in that time frame in which you worked Hence
Ideally you are left with only one choice (3b) that 100% tax is paid by the company.
Using 3(b) you will file you taxes using only full time W2 and just ignore the 1099 income this suits you immigration needs also (Green card).

Now the problem in 3(b) is Employer will report taxes to IRS using your SSN and if there is a link between between IRS and immigration it might be affecting your green card. That is where you need to talk to immigration lawyer.

(5) Best case scenario
Return all the 4 months income back to employer. Get the 1099 canceled from employer. Ask employer to pay you later once you get the concurrent H1B approved.
Ideally you can't have can't income either on W2 or 1099 unless your concurrent H1b is approved. This way you avoid any problems with immigration.
 
Clarification...

I am sorry about not writing it carefully.I actually applied and recd concurrent H1b before starting moonlighting with 1099 wages.My concern was only about whether I am eligible to get 1099 income while I am on H1B as it amounts to private income.
Thanks and apologies again for not writing it correctly.
 
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