What are the different IRS tax forms? There are many different tax forms to fill out when filing your taxes. A 1040 is an employee tax return and that means that you work for somebody. Now a person that...
A 1040 is an employee tax return and that means that you work for somebody. Now a person that is self-employed, like a contractor, is a sole proprietor. He files a 1040 also but his has a schedule C attached and the schedule C is his business. He will have so much income that he received and its called non-employee income. It is 1099 income and then he will list all of his expenses that he had to do those jobs and then what's left over is his net income that he pays taxes on. By the way, I didn't mention this, self-employed people not only pay regular income taxes, but they also pay 15.3% self-employment taxes. Now as an employee, it's called social security. 15.3% is social security, but with the company he works for pays half of it and he pays half of it. If you are self-employed, you pay the whole 15.3%.
