Another person and myself did contract work. The company sent the entire payment for the work to me and I paid the other person out of that money.

How do I report this on my taxes? I received the proper form from the company for the full payment, but how do I deduct the payment out to the other person?



You send the proper form to the other person for the amount you gave him, and file it as your business expense on your Schedule C.

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  • This is not through a business. We were paid as individual contractors. I just happened to be the one the check was issued to and I sent the other person his half. Does that make a difference? – Paul Peterson Feb 15 '12 at 20:39
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    @PaulPeterson that was what I was referring to. As a sole proprietor ("individual contractor") you're supposed to file your business related income and expanses on Schedule C of the form 1040. – littleadv Feb 15 '12 at 20:46

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