In my work contract, I am called an independent contractor. No taxes are taken out of my pay. Am I considered self-employed? That is, do I have to file quarterly estimated self-employment taxes as if I were a small business? To add to the confusion, the company also reimburses me for my expenses, such as phone bills and supplies. When I receive my Form 1099 at the end of the year, should I then subtract the reimbursed expenses, and report only the wage portion as my income?
You may not have sprouted golden arches from your head, but if you are an independent contractor, you are a business. You must follow the self-employment tax rules -- including filing quarterly estimated taxes.
If the Form 1099s you receive include your expense reimbursements, you must report the entire amount as income on your tax return, then deduct the amount of the expense reimbursement as your own business expense on your Schedule C.