I am self-employed and considered an independent contractor. I’m a dancer/entertainer and get paid in cash. In the beginning of 2017, I was working a few regular jobs (quit in summer 2017) and had W2s to enter. I was dancing at the same time (then just strictly dancing during the rest of the year after quitting) and included my self-employed cash income as well. I wasn’t dancing as often as I currently do and just kind of did it to get bills paid and get by. I still made a decent amount of money but I would definitely say not as much as the average dancer would make if they really “tried” and worked 5-6 days a week. I kept track of my income and made regular cash deposits so my money was accounted for and I paid a decent amount back in taxes.
For 2018, I was only dancing and did it full-time and made a lot more money compared to 2017. There’s no “real reason” for this besides me taking it more seriously (trying to get my financial situation together, pay off student loans, etc.) and working nearly every other day. I kept track of my income and made regular deposits just like 2017. But my income for 2018 is much greater and that is what I’m worried about. I tried to keep records of everything as best as I could. I logged everyday that I worked and the amount I made that day, my bank statements show my cash deposits, and I kept all my receipts (paper and online) for work-related expenses. Even with my expenses, I can see I am going to have to pay back a lot more than last year, which I have no issue with and am capable of paying.
I guess I am just slightly freaking out because I feel like it looks odd that my income has increased drastically. Most of my dancer friends tell me I have nothing to worry about and the IRS is really only concerned with people who make a crazy amount of money. I made a lot of money (nothing super crazy) but it’s more about the fact that it’s a huge difference from the previous year. I only started dancing towards the start of 2017 and was working a minimum-waged job at the same time (until the middle of the year). So 2018 was the first year that I danced full-time and I have never made money like this before so I’m just a little nervous and worried about everything. If it matters, I am in my early twenties, file as Single, live on my own and support myself completely. Majority of the money that didn’t go to work-related expenses was used for bills, debt, student loan payments, etc.
Sorry, this was so lengthy, but felt like I had to tell the whole thing for everything to make sense. I’m appreciative of anyone who took the time to read all of it!
