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options for small 1099 income

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  • options for small 1099 income

    I'm currently a resident and will be sent away for a 6 month rotation. While at the rotation, they provide room and board, but "pay" you the cost of rent and send you a 1099 at the end of the year. For me it will come to a total of nearly $6K in 1099 income. So I never actually see the money, but have to pay tax on the income. Not a terrible deal since I'm in a low tax bracket and therefore my true cost to "rent" out there for 6 months would be about $2k. But I wanted to know if there is anyway I can use this 1099 to my benefit and put extra money into retirement accounts. Also I may be able to do some moonlighting and bump my total 1099 up another $10-20K. Already max out my roth 403b accounts (no match) and roth IRA yearly. Any suggestions?

  • #2




    I’m currently a resident and will be sent away for a 6 month rotation. While at the rotation, they provide room and board, but “pay” you the cost of rent and send you a 1099 at the end of the year. For me it will come to a total of nearly $6K in 1099 income. So I never actually see the money, but have to pay tax on the income. Not a terrible deal since I’m in a low tax bracket and therefore my true cost to “rent” out there for 6 months would be about $2k. But I wanted to know if there is anyway I can use this 1099 to my benefit and put extra money into retirement accounts. Also I may be able to do some moonlighting and bump my total 1099 up another $10-20K. Already max out my roth 403b accounts (no match) and roth IRA yearly. Any suggestions?
    Click to expand...


    You should be able to deduct a per diem for the cost of the R&B on your schedule C to offset part of the 1099. Probably can deduct meals, too. Not sure why you never see the money if they are giving you $6k and you are paying $2k living exp...

    Yes, you can set up a SOLO-k and contribute ~20% of the net profits of your "business" including moonlighting income. Highly recommended.
    Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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    • #3
      (Deleted duplicate post.)
      Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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      • #4
        Thanks Johanna. I never see the money because it cost $6K for living expenses, not 2. What I was trying to get at was I'm taxed on that $6K of income so in essence its like I'm paying only $2k (in taxes) to live there. Thanks for the info

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        • #5




          Thanks Johanna. I never see the money because it cost $6K for living expenses, not 2. What I was trying to get at was I’m taxed on that $6K of income so in essence its like I’m paying only $2k (in taxes) to live there. Thanks for the info
          Click to expand...


          You're welcome - makes more sense now  ops: !
          Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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          • #6
            Could you also contribute to a SEP-IRA as opposed to a solo-k?

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            • #7




              Could you also contribute to a SEP-IRA as opposed to a solo-k?
              Click to expand...


              He could but would then be prohibited from a back-door Roth after training. Plus, better to have the SOLO-k available for later years (to roll into when he changes jobs) imo.
              Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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