If none of the following apply to you, you may
Clear and Start Over
with your return to select a different software version.
Sole proprietor, independent contractor, consultant
and freelancer are all terms used to describe self-employed workers. Whether
you do it full-time or on the side—if you’re an independent worker like an
Uber/Lyft driver, web designer, tutor, or babysitter—you’re self-employed.
You may not think of yourself
as running a business, but you’re considered self-employed if you engage in
business-like activities.
Three key factors that
generally define an activity as a business:
- You intend
to make a profit (even if you operate at a loss).
- Your
activities are regular.
- You make
efforts to sustain or grow your business.
Situations where you wouldn't
be considered self-employed:
- You mowed
your elderly neighbor's lawn all summer, and he gave you money as a token
of his appreciation. (You didn't intend to make a profit.)
- You were
paid to tutor a friend's child, but you’re not going to do it again. (Your
activities are not regular.)
- You draw
for fun, and your friend paid you to create a poster for a birthday party.
(You're not making efforts to sustain or grow a business.)
When you’re self-employed,
you’re likely to receive a 1099-MISC or a 1099-K. Even if you don’t receive
these forms, you still need to report all your income from self-employment.
