Yes. You must report all your income on the same tax return, no matter how small. It is probably reported as self employment income. You can enter Self Employment Income into Online Deluxe or Premier but if you have any expenses you will have to upgrade to the Self Employed version.
How to enter self employment income
I see. I guess this year I will begin charging sales tax. I provide remote services to android phones.
From what I have gathered, I can also submit deductions related to the earned income such as internet, website/domain, other stuff such as money paid to use payment gateway etc. Is this accurate?
Also, If I have someone help me and I pay him (usually just send through paypal or transferwise) does this need to be reported?
I just started it a few months ago but didn't expect to be making over 4k per month or more LOL. I don't want to get in trouble or "audited". At least since I use an official gateway all my income data is easy to retrieve.
I don't know how sales tax works. This is a forum for income tax. Here's some general info....
You might want to use Quicken or QuickBooks to keep tract of your income and expenses. There is one called QBSE QuickBooks Self Employed that works with Online Turbo Tax and will give you a free online tax return next year.
You need to report all your income even if you don't get a 1099NEC or 1099Misc. You use your own records. You are considered self employed and have to fill out a schedule C for business income. You use your own name, address and ssn or business name and EIN if you have one. You should say you use the Cash Accounting Method and all income is At Risk.
After it asks if you received any 1099Misc it will ask if you had any income not reported on a 1099Misc. You should be keeping your own records. Just go through the interview and answer the questions. Then you will enter your expenses.
Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit greater than $400. The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare. So you get social security credit for it when you retire. You do get to take off the 50% ER portion of the SE tax as an adjustment on 1040. The SE tax is already included in your tax due or reduced your refund. The SE tax is in addition to your regular income tax on the net profit.
Here is some IRS reading material……
IRS information on Self Employment
Publication 334, Tax Guide for Small Business
Publication 535 Business Expenses
You need to give a 1099 NEC or 1099 Misc to anyone you paid $600 or more to for the year. But not to corporations or for merchandise. You send the IRS a copy of the 1099Misc with the transmittal summary form 1096. These are due to the person by Jan 31 and to the IRS by Jan 31.
To prepare W2s or 1099NEC or 1099MISC you need to use the Online Self Employed version or buy the Desktop CD/Download Home & Business program or the separate Turbo Tax Business program.
How to prepare 1099NEC 1099Misc & W2