The logic I've seen used for paying signing bonuses as non-employee compensation (Form 1099) is that the payment is not for your services, but rather for your agreement to become an employee.

I'm not sure I buy the logic, and the distinction is not clear to me either. It seems to me that is a payment for your future services, and should be reported on your W2. However, it is fairly common practice to pay it as Form 1099 income.

Zip Code: garyd@davisandbrandel.com

FYI, my future employer has told me that the IRS recently clarified that signing bonuses cannot be 1099 income - instead they must be W-2 and subject to conditional witholding.

Zip Code: pglickman@partners.org