S.W. Counselor

[Noninawell]

Hello, I’m a retired social worker and I often get referrals from former clients to assist their friends/relatives. They pay by Zelle, PayPal and cash app, I don’t have a registered business, what do I need to do regarding these tax changes? 

[John-H2021]

Hello

You would need to claim the income on your tax return 

There are 2 ways to report the income.

1. If it is a hobby then the income is reported on schedule 1 for the full amount of the 1099 no expenses allowed to be taken
2. If it is a business then it would be reported on a schedule C (self-employed income). You would report the 1099 as income and then deduct the expenses you have against making that income.

You don't need a register business to report this income you would just be considered self employed and use your name as the business name

Here are a few helpful links

https://turbotax.intuit.com/tax-tips/small-business-taxes/when-the-irs-classifies-your-business-as-a...

https://turbotax.intuit.com/tax-tips/self-employment-taxes/4-tax-tips-for-money-making-hobbies/L89qz...

https://turbotax.intuit.com/tax-tips/self-employment-taxes/beginners-tax-guide-for-the-self-employed...