Tax Resources

The Internal Revenue Service (IRS) requires Texas A&M University to report all cumulative payments of services of $600 or more in a calendar year on a 1099-MISC Form. This informational form covers a wide range of payments you can receive, such as rent, royalties, prizes and awards, payments to research and survey participants, settlement payments and medical services. However, the more common use of the form is to report your earnings when you work as an independent contractor.

A 1099-MISC form serves a similar purpose to an independent contractor as a W-2 does for to an employee. The form reports the total amount of payments you receive from a single person or entity during the year that you provide services to. It will classify each type of payment in separate boxes on the form depending on the reason for your payment. Generally, if you receive payment for contract work you do, then your annual earnings will appear as nonemployee compensation.

1099-MISC is due to service providers on or before January 31st.

An Employee is an individual who performs a service for the university/agency and is working under the direction and control of the university/agency or its employees. Direction and control can be implied to exist when the employer has the right to control both the results as well as the means and methods of the worker. (IRS Treasury Regulation 31.3121(d)-1(c)).

An Independent Contractor is an individual engaged by the university/agency to perform a specific function or task and who is free to perform this function or task completely at the individual's own discretion with regard to means and methods. No taxes are required to be withheld or paid on compensation disbursed. (IRS Treasury Regulation 31.3401(c)-1(b)). The existence of an agreement or contract helps support the independent contractor position. This document should be fairly specific in what is to be provided and amount or lack of control the university/agency has over the individual.

To determine if an individual is an employee or independent contractor, complete the Worker Classification Questionnaire and submit to tax@tamu.edu.

Under Internal Revenue Code (IRC) Section 127, employees enrolled in graduate level classes and who receive employer provided tuition benefits or graduate tuition waivers must include in income the amount of tuition waivers that exceed $5,250 in a calendar year.

Additional Information:

Form W-2, also known as the Wage and Tax Statement, reports employees' annual taxable wages and the amount of taxes withheld on those wages.

Form W-2 for a taxable year must be mailed or electronically provided to employees and reported to the SSA on or before January 31st of the following year.

See the W-2 FAQs for more information.