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Immigration & Taxation Issue - What is the best way to pay a resident alien (TN Visa) a bonus for work? 1099? W-2? Other?

Los Angeles, CA |

Resident alien employee (TN Visa) employed with employer A in 2009-11. Employee does a good job on a client matter, but the matter does not resolve until 2013 when Employee no longer works for employer A. However, employer A gives a bonus to Employee (now working for employer B) in 2013 for the work done in 2009-11. Employee works for employer B in 2011-13.

What is the best way to document 2013 bonus? 1099 means employee is self-employed (she is not). W-2 means Employee is working for employer A when in fact she is with employer B.

Want to avoid triggering estimated tax issue & penalties and giving wrong impression that Employee is working for 2 employers when she is not. Also don't want to give the wrong impression she is self-employed. How can bonus be categorized?

Attorney Answers 4

  1. Based upon what you have described, since the person is no longer employed by employer A and he/she is receiving a bonus for past services rendered, the proper way to report that payment would probably be on Form 1099-MISC.

    The answer to this question does not establish an attorney-client relationship. Moreover, this attorney is licensed to practiced law ONLY in the State of California. Answers to questions from users in other jurisdictions or states are meant to provide only general information. Users should contact a local attorney in their jurisdiction or state to address their specific tax issue.

  2. Form 1099, since the person is no longer employed by that employer. But, don't take my word for it. I am only an immigration lawyer. Consult with a CPA or accountant on this to be sure.

    Kindly be advised that the answer above is only general in nature cannot be construed as legal advice, given that not enough facts are known. It is your responsibility to retain a lawyer to analyze the facts specific to your particular situation in order to give you specific advice. Specific answers will require cognizance of all pertinent facts about your case. Any answers offered on Avvo are of a general nature only, and are not meant to create an attorney-client relationship.

  3. Not an immigration law question.

    Mr. Shusterman is a former INS Trial Attorney (1976-82) with over 35 years of immigration experience. His response to your question is general in nature, as not all the facts are known to him. You should retain an attorney experienced in immigration law to review all the facts in your case in order to receive advice specific to your case. Mr. Shusterman's statement above does not create an attorney/client relationship.

  4. I recommend seeking an International Tax lawyer for information.

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