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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?

Thanks!

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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.

  • 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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