27 Aug Gig Economy Jobs – Tax Tips
Gig Economy is the buzz job industry of the era, especially so since COVID-19 has come into our lives. But your side-hustle, even if only temporary is still a job, where you still earn an income, and you still must file a tax return if you have net earnings of $400 or more.
Ugh, For Real?!
Yes, you must pay tax on income you earn. If you are an employee, your employer withholds tax from your paycheck. If you work as an independent contractor, you may have to pay estimated taxes. Unsure what you are considered: check your worker status.
What do I have to do?
- Keep Good Records: Keep receipts of your expenses, some expenses lower the tax amount you owe. If you don’t receive a 1099 for your earnings, so keep a separate record of what you earned.
- Pay Estimated Taxes: Federal tax due the IRS is “pay-as-you-go”, which is why its withheld on your paycheck. If you don’t have it withheld and don’t pay it, you’ll get a penalty. Figure out what to pay using Form 1040-ES or contact your accountant (like us!). There are quarterly payment deadlines, so keep that in mind!
Then What?
Well, then you need to file your taxes, noting all the income earned (hopefully reflected on a 1099). That’ll all go on your 1040 Schedule SE (Self Employment) or Schedule C (Sole Proprietor). Forgot about one of those jobs but already filed? Its ok, you can amend your return using Form 1040-X.
We can do it all for you, you just have to give us a call to schedule time with one of our accountants. Call us at 614-524-4888 or email clientcare@taxdefenseohio.com!
