Q: I am a caregiver for adult disabled child. I am paid by the state. I normally receive a 1099 and file that as
Nontaxable income but this year i received a w2. Do i file the same way or do i owe income tax on this?
A:
The most important question is why believe the 1099 income was not taxable. IRS publication 525 specifically lists the kinds of income that are not taxable. https://www.irs.gov/pub/irs-pdf/p525.pdf You may be able to get a caregiver tax credit if you are a family member or "qualifying relative."
1099 income and W-2 income are both forms of income, the 1099 just means you own your own business (as an independent contractor) while a W-2 means you're an employee.
Here's a short Q and A on the IRS website about Self-employment tax and employer withholding tax on caregiver income. https://www.irs.gov/businesses/small-businesses-self-employed/family-caregivers-and-self-employment-tax
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