Employee misclassification generates substantial losses to the federal government and state governments in the form of lower tax revenues, as well as to state unemployment insurance and workers’ compensation funds.

Is it worth being a 1099 employee?

As a 1099 contractor, you receive more tax deductions like business mileage, meal deductions, home office expenses, and work phone and internet costs, as well as other business expenses that can lower your taxable income. Therefore, contractors might end up paying fewer taxes than a traditional employee would.

What happens if you are misclassified as a 1099 independent contractor?

Being misclassified as a 1099 Independent Contractor means you most likely have no benefits available if you are injured on the job, laid off, or fired. If you feel you’ve been classified incorrectly, you can file an employment insurance claim with your state unemployment agency and explain your situation.

Who is responsible for unreimbursed expenses on a 1099?

Independent contractors incur unreimbursed expenses throughout their work day and are responsible for providing the funds to cover equipment necessary to perform their job. These contractors also make their services available to numerous clients for a flat fee. Employees do not work under any of these conditions.

When do I need to use form 8919 for unemployment?

You can only use Form 8919 if one of the following factors applies to your situation: Being misclassified as a 1099 Independent Contractor means you most likely have no benefits available if you are injured on the job, laid off, or fired.

What to do if you have been misclassified as a contractor?

Filing for unemployment with your state agency, you will have to explain that you have been misclassified as a contractor rather than as an employee and they will look into the matter for you. Having an attorney working with you will speed this process and possibly get your resolution through faster so are not losing revenue for too long of a time.