If I classify caregiver as a contractor who is issuing/submitting 1099, me as representative or my mother?

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I'm the daughter and I'm my mother's representative. I asked a friend to help with caretaking as it was needed unexpectedly. Mom is a dementia patient. We're only talking about 4 months but I asked her to do it as a favor for $10.00 an hr cash while I was at work. We have paid her with moms SS funds and some family support. Mom has not filed taxes for years since she has a very limited income about $1600.00 a mo. I want to do what is right and if that means paying my caregivers taxes then that's what I might have to do. If I classify her as a contractor who is issuing/submitting 1099? Me as the representative under my tax responsibilities or my mother? I am completely stressed out after reading these posts. "V"

Answers 1 to 6 of 6
Is your friend claiming the money she earned on HER taxes?
Could be a big mess if you claim it and she didn't.
Top Answer
You don't classify people after the fact as employees or contractors...that is decided upon at the beginning, of the financial relationship. So you didn't withhold Social Security and income tax from what you paid her. Then give her a 1099, not a W-2, and let her worry about her own taxes. The 1099 is also sent to the IRS as well as being given to her. Who paid the caretaker, you or mom? Who decided to arrange this deal and made sure she got paid? If that was you then you should issue the 1099. This should be a warning tale for everyone engaging in a business relationship....know what you're doing before you do it.
The funds came from my mother's account but I am the representative and I made the arrangements. At the time this was an emergency and we did not have anyone available to stay with my mother. We were trying to keep mom safe and did not plan the relationship as a business. We couldn't expect someone to help without being compensated. The caretaker did it as a favor to the family and $10.00/hr was all mom could afford.
If you are acting as your mother's rep and are using her funds, the 1099 is issued in her name. That way Medicaid/care/SSA can trace the info back to her. It's the same as if you are working for a corp. You are their agent paying wih their money. Their name is issuing the 1099, but if it has to be signed, it's your signature. The corp is the one financially liable - as is Mom.

It's not your problem if the CG was not planning to report income. You have to get the1099 out and she will have that before she files. If she files too soon, she can file an amended return. I'm in favor of everyone paying their fair share of taxes as written in the tax code. Hiding income is fraud.
If this was more than likely a 1 time thing & not at all likely to happen again this year, I’d do it as a 1099 done by mom. If it’s under $600 paid in fees for the year a 1099 doesn’t have to be done at all btw.

The rub is going to be that in order to do the 1099, you are going to have to get her to fill out & sign a W-9. As you need the info on the W9 to do the 1099. If she was thinking this was going to be unreported income, well there’s going to be unhappiness as 1099 will mean taxes due as not withheld on the income, 1040 long needs to be done. If she’s on any at-need program, extra income could be a problem.
Refer to uscisdotgov...does not appear that an independent contractor needs to provide.an I9

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