H-1 B 1099K

[taxrelated]

My Status H-1 B

Working on H1-B and getting W-2 salary.

In 2012 Oct through Dec I have helped my friend who has a PC troubleshooting call center in India ask me if can process US customer payments using my business Paypal account which required my SSN. I knew that while on H-1 I can only work for my employer who holds my H-1. I thought just a Paypal account will be fine since I do not own company who will be entitled to get payments. I did not get any salary, commission or profit from my friends company. I just did it as a favor to help him until he sets up his own payment process. But in just 4 months there were transactions of $40250 and as per IRS and Paypal policy it was reported to IRS in 1099K form.

Now I am worried that will it cause any trouble in my existing approved H-1 (expiry date July 2015 - Not stamped)

Will it cause any trouble to Green card processing about to start in Aug 2013.

What should i do - I just need helpful suggestion before I file both 1099K and W-2 taxes. Please advice. Thanks!

[JoeF]

I thought just a Paypal account will be fine

You thought wrong.

You tired to get around the immigration laws, and that of course failed.

You are in deep deep trouble now.

On H1, you can NOT NOT NOT work for anybody else.

You worked illegally. You are out of status.

It WILL result in problems. Why in the world did you even do this kind of stuff??? This is the US, such thing always come out.

You need to see a good immigration lawyer ASAP.