H1B and 1099-MISC

[cktechie2012]

Hi

I have a question on Referral Bonus from Non-Employer.

I am currently working in US on Valid H-1B. I received Referral Bonus from a recruiting company for joining my new employer. I have not performed any services or done any work for this recruiting company, and this referral bonus was just for plain joining my new employer.

Now the recruiting company has given me the 1099-MISC and included this referral bonus in the Box.7 - Non-Employee Compensation, which make me look like I have self-employment, and I need to submit for self-employment taxes.

Is accepting 1099-MISC legal while on H-1B for such referral bonuses (I strictly abide by the H-1B rules, working only for my employer and not indulging in non-lawful work)

Anyone has any inputs / advice / suggestions?

Please help.

Thanks

[raghvi]

Hi

I have a question on Referral Bonus from Non-Employer.

I am currently working in US on Valid H-1B. I received Referral Bonus from a recruiting company for joining my new employer. I have not performed any services or done any work for this recruiting company, and this referral bonus was just for plain joining my new employer.

Now the recruiting company has given me the 1099-MISC and included this referral bonus in the Box.7 - Non-Employee Compensation, which make me look like I have self-employment, and I need to submit for self-employment taxes.

Is accepting 1099-MISC legal while on H-1B for such referral bonuses (I strictly abide by the H-1B rules, working only for my employer and not indulging in non-lawful work)

Anyone has any inputs / advice / suggestions?

Please help.

Thanks

How is joining an employer be called as referral bonus, isn't it a joining bonus? Referral bonus would have been had you referred someone else and they would have joined. Had that been the case, you could have reported this on your 1040, but as you are the employee who has joined it seems more of a commission from the recruitment company.

Technically H1B holders should not get 1099 Income. Talk to a tax expert to determine how to report it.

This is my opinion not legal advice.

[cktechie2012]

How is joining an employer be called as referral bonus, isn't it a joining bonus? Referral bonus would have been had you referred someone else and they would have joined. Had that been the case, you could have reported this on your 1040, but as you are the employee who has joined it seems more of a commission from the recruitment company.

Technically H1B holders should not get 1099 Income. Talk to a tax expert to determine how to report it.

This is my opinion not legal advice.

My mistake in choosing the wrong word, yes it is joining bonus.

Is there a way to fix it, since I have already received the 1099-MISC and the recruiting company would have reported it.

[raghvi]

If you en cashed it there is nothing you can do now. IRS and USCIS dont usually interact unless the amount involved is substantial, just hope it doesnt happen in your case.

This is my opinion not legal advice.