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Can an employer build 1099 wages into your hourly wage paycheck? Nevada

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  • Can an employer build 1099 wages into your hourly wage paycheck? Nevada

    Situation: I worked for a building inspection company and since we use our personal vehicles for business use, they pay us what they claim is a vehicle rental fee.

    This "vehicle allowance" is a set amount every month and is built into our hourly wage paychecks every 2 weeks.

    We receive a normal W-2 for the hourly wages at the end of the year, but also a 1099 for the vehicle allowance.

    Is it legal to include both on the same paycheck since they claim one is a "rental fee"?

    No taxes are taken out of the vehicle rental fee on our paycheck every 2 weeks, but we are responsible for those taxes at the end of the year on the 1099. the IRS tax law division told me the company was basically screwing the employees by doing it that way and said in fact it might be illegal.

    Any ideas?

  • #2
    I'm confused. Are you saying the vehicle allowance is added into gross wages on your regular paycheck but not into taxable wages and therefore taxes are not withheld on that amount? Then you get a 1099-MISC for the vehicle allowance amount?

    In any case, no. Allowances are fully taxable unless they might the definition of an accountable plan. Plus, any compensation related to your employment goes on a W-2, not a 1099.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.


    • #3
      The vehicle allowance is a separate section of my pay stub.

      It isn't built into either the gross or taxable wages, its just added to the amount of the net wages and combined on a single check.

      They consider this a vehicle rental not a "wage" per se.Thats their excuse for giving the 1099 Misc.


      • #4
        Like Patty said, your employer is wrong.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)