We live in Pennsylvania. Our income is primarily social security (wife and I). I started working for DoorDash in February for extra income.
I have been keeping track of mileage and other expenses for tax purposes. Should I estimate my DoorDash income through 2024 and pay a quarterly filing or just wait till 2025 to file?
So the primarily Social Security is what is sticking out to me here. The reason is as follows:
Your Social Security benefits could be taxable depending on your situation. According to the IRS, the best way to see if you’ll owe taxes on your Social Security income is to take one-half of your Social Security benefits and add that amount to all your other income. This includes tax-exempt interest. This number is known as your combined income, and this is how it’s calculated:
Combined Income = Adjusted Gross Income + Nontaxable Interest + 1/2 of Social Security Benefits
If your combined income is above a certain limit (the IRS calls this limit the base amount), you will need to pay at least some tax. For 2024 the limit for joint filers is $32,000. Above that amount Social Security (up to 85%) would be considered income.
So lets use an example here: Door Dash net income is $5,000. Other non-social security income is $5K and Social Security income is $30K. None of the Social Security income is taxable since $5K+$5K+($30/2=$15K) is only $25K. Your adjusted gross income is the $10K, and with the standard deduction being $29,200 when filing married filing jointly, (plus $1,550 for each of you 65 or older) you would have no taxable income.
The key thing here is what is the actual net income from Door Dash? To the extent there is net income you should consider making estimated tax payments for the SE tax. SE tax is 15.3% of 92.35% of SE income.
You can go to IRS Direct Pay to make a payment.
Thank you so much for your question @RAHeller48
Be well and safe!
Marc T.
Turbo Tax Expert
27 Years of Experience Helping Clients