Hi! I have recently started a side gig. If I have all of my clients pay me through a Venmo business profile, I know I am to receive a 1099K at the end of the year. Should I not have my clients send a separate 1099 NEC since the same payment will be included in the 1099K through Venmo?
Do I need any other record of my transactions or so long as everyone pays me through that account and I report everything on my 1099k, am I good to go?
If I were to use another method like Zelle instead, how would I report that? I'm thinking I'd prefer not to use zelle for that reason, but what else would be recommended in terms of keeping track of my records? Thank you!
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Hi @Emi2 !
Congratulations on your new side gig!
Basically, you want to report all of your income from all sources. You do not want to duplicate any income, but anyone that is required to issue you a 1099-NEC will still have to issue it to you, even though it may also be income that is reported on the 1099-K. The requirement to issue 1099-NECs is dictated by the IRS, not the individual recipients. It's not uncommon for the IRS to issue letters questioning unreported 1099-NEC income, so don't be alarmed if you get one. You can reply that the income was in fact reported as part of the 1099-K income, or as part of your total gross receipts on line 1 of your schedule C. As long as the records the IRS has of 1099-NECs don't total up to more than you are reporting, it should be alright.
You may also want to consider using the QuickBooks App to track your sales and expenses. This would give you complete records and cover any payments made by whichever methods you accept them through. https://quickbooks.intuit.com/accounting/mobile/
Hope this helps!
Cindy
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