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Bmhr73
Level 1

CashApp

I clean my friends Airbnb for her and she pays me through cash app. I have made over $600. How will that work when it comes time to file my taxes

1 Best answer

Accepted Solutions
VolvoGirl
Level 15

CashApp

When you get paid with a 1099NEC or no form you are a self employed independent contractor. You will file a Schedule C in your personal 1040 return.

 

Some general info on self employment on Schedule C.......

You will need to keep good records. You may get a 1099NEC at the end of the year if someone pays you more than $600 but you need to report all your income no matter how small. You might want to use Quicken or QuickBooks to keep track of your income and expenses.

 

There is also QuickBooks Self Employment bundle you can check out which includes one Turbo Tax Online Self Employed return....
https://quickbooks.intuit.com/self-employed


When you are self employed you are in business for yourself and the person or company that pays you is your customer or client.

 

To report your self employment income you will fill out schedule C in your personal 1040 tax return and pay SE self employment Tax. You will need to use the Online Self Employed version or any Desktop program but the Desktop Home & Business version will have the most help.


Turbo Tax Beginners Tax Guide for the Self Employed
https://turbotax.intuit.com/tax-tips/self-employment-taxes/beginners-tax-guide-for-the-self-employed...


What is form 1099NEC?
https://turbotax.intuit.com/tax-tips/irs-tax-forms/what-is-form-1099-nec/L5fbwIFSn


Here is some IRS reading material……
IRS information on Self Employment
https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center


Publication 334, Tax Guide for Small Business
https://www.irs.gov/pub/irs-pdf/p334.pdf


Publication 535 Business Expenses
https://www.irs.gov/pub/irs-pdf/p535.pdf

 

You pay Self Employment tax on $400 or more of net profit from self-employment in addition to any regular income tax. 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.

 

View solution in original post

2 Replies
Donna F 77
Employee Tax Expert

CashApp

Congratulations on your side gig income!  Since you earned over $600, your friend should report the income she paid you on a 1099-NEC.  Once you receive that, you will complete the Self-Employment Income and Expenses section in TurboTax Online to claim the income from the 1099-NEC and any related expenses that you paid.

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VolvoGirl
Level 15

CashApp

When you get paid with a 1099NEC or no form you are a self employed independent contractor. You will file a Schedule C in your personal 1040 return.

 

Some general info on self employment on Schedule C.......

You will need to keep good records. You may get a 1099NEC at the end of the year if someone pays you more than $600 but you need to report all your income no matter how small. You might want to use Quicken or QuickBooks to keep track of your income and expenses.

 

There is also QuickBooks Self Employment bundle you can check out which includes one Turbo Tax Online Self Employed return....
https://quickbooks.intuit.com/self-employed


When you are self employed you are in business for yourself and the person or company that pays you is your customer or client.

 

To report your self employment income you will fill out schedule C in your personal 1040 tax return and pay SE self employment Tax. You will need to use the Online Self Employed version or any Desktop program but the Desktop Home & Business version will have the most help.


Turbo Tax Beginners Tax Guide for the Self Employed
https://turbotax.intuit.com/tax-tips/self-employment-taxes/beginners-tax-guide-for-the-self-employed...


What is form 1099NEC?
https://turbotax.intuit.com/tax-tips/irs-tax-forms/what-is-form-1099-nec/L5fbwIFSn


Here is some IRS reading material……
IRS information on Self Employment
https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center


Publication 334, Tax Guide for Small Business
https://www.irs.gov/pub/irs-pdf/p334.pdf


Publication 535 Business Expenses
https://www.irs.gov/pub/irs-pdf/p535.pdf

 

You pay Self Employment tax on $400 or more of net profit from self-employment in addition to any regular income tax. 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.

 

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