Question

Self Employed am I a material participant?

Forum|Forum|6 years ago
February 25, 2020
1 reply
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Hi, I am retired and just started a Marketing Research Contracting Service in April 2019. I did 558 hours of work during the year for 2 companies. I got a 1099 and am not an employee. I am not a decision maker and take direction from an employee of the companies. I have no involvement in the business other than conducting marketing research for them. For Sch. C purposes am I a material participant or not? Thanks

Not A Product Question

VolvoGirl

Employee

Is that at the end where it asks if your business is At Risk? If you don't know what it means then probably All your Investment is at Risk (check Box 32a). It means you are using your own money for the business.

And you are 100% participant in your own self employment business. When your are self employed you are your own business yourself. It's not asking about the businesses that pay you.

V

vbyrd7058Author

Thank you. I was concerned with this question. Yes I am 100% self employed and get a 1099 from the business that pays me.

ColeenD3

While you only need to meet one of the criteria for material participation, you met at least two.

Your participation was substantially all the participation in the activity of all individuals for the tax year, including the participation of individuals who didn’t own any interest in the activity.
You participated in the activity for more than 100 hours during the tax year, and you participated at least as much as any other individual (including individuals who didn’t own any interest in the activity) for the year.
Pub 925