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Thread: Big (huge) tax problem

  1. #1
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    Default Big (huge) tax problem

    Ladies, I need serious advice,

    The club I'm at up in Michigan takes about 1/3-1/2 ($7 of a $20 dance) of our dance money a night. They keep track of every dance we do during the night and at payout, the take a percentage of it along with a base rent fee ($5). Problems being;

    A) I get overmarked by an average of one dance a week. These charges for non-existant dances do not get removed by the manager at the end of the night. Appx. $7 per week = $13 a week I pay tax on that I did not make. That's over $600 a year.

    B) The first year I was employed there they charged me a $30 base rent as opposed to the normal $5 because I choose to work only three days a week instead of the required four. I discovered this year when I went to find an accountant that they had marked this additional base rent as $5 base rent and 5 $5 dances (=$30). Not good. This turns a majority of my work expense into taxable income. My managers have not replied to my requests for a letter correcting the information to take to my accountant.

    I'm going to get stuck paying taxes on, get this...almost $10,000 that I did not make!!! Plus all the late fees since this was all from last year!! Should I suck it up and pay, or find an attourney? I love my club and love working there, but this is absurd!


  2. #2
    God/dess montythegeek's Avatar
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    Default Re:Big (huge) tax problem

    First get the accountant form the company to issue a corrected form ASAP. You have major clout in that the states department of Labor has clout to force them to issue a corrected statement. Send a registered letter return receipt requested to them if they do not do it asap and keep copies.
    Second as I said in another thread, if they screw up the record once keep your own and make them sign your log of records.
    Reissuing the form is a simple thing for them to do. Get them to acknowledege their mistake in writting some how even if you have to threaten them with the hours and wages people. If their record keeping is so screwed up it may be a sign of THEIR cheating on THEIR taxes and the last thing they will want is to get audited by the state.
    DO this tomorrow. Josh may have better ideas on how to deal with bad 1099's but do not delay.

    Backup idea Call the IRS Tax help for individuals line at 1-800-829-1040

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    Default Re:Big (huge) tax problem

    The only 1099 I have is correct. That states only the money I won in competitions. The only proof of actual dance income I have are the copys of my payout slips from every night I worked (and some speradsheets with the same info that calculate my taxes). These slips have my nightly dances itemized, the amount I paid the club, and the amount I brought home. Should I file just using the 1099?

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    God/dess montythegeek's Avatar
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    Default Re:Big (huge) tax problem

    If I understand you correctly it makes things a lot easier. As I understand it correctly the incorrect items are the "working papers", not documents given to the IRS which are marked in a confusing fashion. If it is just supporting evidence which is mismarked it should be easy to resolve--just have the person who is responsible sign a letter written (even by you) stating the clarifying charges are charges not income.

    As I understand it you pay a "premium rent" for working 3 days a week insteaad of 4 which is equal to 5 - $5 charges. All you need to do is be able to make this clear in the event you are audited. File the taxes figured correctly with income as income and charges as charges.

    I was under the impression before you had a bad 1099. I would still pressure them to make their records better,

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    Default Re:Big (huge) tax problem

    I'd go ahead and file based on supplying your own "correct" information entered into your own ledger. If and when you are audited, which is highly doubtful, you can then fight the battle with the club and the auditor IF he raises the issue at all.

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