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Tax question.. Did I do the right thing?

Philadelphia, PA |
Filed under: Tax law

I was babysitting for a relative all last year.. I assumed it was going to be just something to do for a family member... In December my relative gave me cash and said "this is for you. Thank you for watching my children for me all this time." Since the amount they gave me a couple thousand dollars,I assumed i had to claim this as income on taxes. Did i do the right thing? Was I supposed to claim this even without thorough documentation? I was not given a 1099 (babysat in my house) and I dont even know if my relative claimed the expense on their taxes...

Attorney Answers 3

  1. Yes it is reportable, this income also allows for applicable expenses to be reported. This could result in a lower realized gain and tax due.

    Louis T. Wierenga Assisting in mitigating your business and tax risks. E Twitter @LTWLAW The information provided is for general purposes only and should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.

  2. Yes, you did the right thing. Best

    This reply is offered for educational purpose only. You should seek the advice of an attorney. The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than an educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the undisclosed individual asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of New York. Responses are based solely on New York Law unless stated otherwise. Pursuant to Internal Revenue Service guidance, be advised that any federal tax advice contained in this written or electronic communication is not intended or written to be used and it cannot be used by any person or entity for the purpose of (i) avoiding any tax penalties that may be imposed by the Internal Revenue Service or any other U.S. Federal taxing authority or agency or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

  3. Report it as if you did receive 1099... As pointed out above you can then deduct your expenses, such as automobile expenses if you had to use it, etc...

    Of course my answers are not the only source that you should rely on. Furthermore, its best to contact me about your Legal or Medical issues at my office number 215-240-7565. Licensed to Practice Law in PA and NJ. Medical PA license.