Tax and Reporting Free?

Q. Is there a statement somewhere in the tax laws that states, I can pay someone up to $600.00, tax free to both parties? Or something to that effect?

A. Yikes!  Every time I get a question like this it scares me to death.  “There is no such thing as a free lunch.”  “Certainty? In this world nothing is certain but death and taxes.” You can read more Ben Franklin quotes here.  Your statement illustrates the confusion most people have regarding payments to independent contractors, and the reporting required to the IRS for those payments.

First of all, if you have income, it is taxable.  I can confidently state that Read more »