I have gigs income on top of a main w-2 income. I only got w-2 for those gigs. So my self employment section will only have expenses and no income?

[Critter]

Sorry but if you are an employee paid on a W2 then you CANNOT use the Sch C for the expenses UNLESS the Statutory box is checked in box 13 of the W-2.  

[Critter]

Can employees deduct any job-related expenses?

Job-related expenses for employees are no longer deductible on most people’s federal return in tax years 2018 through 2025 due to the Tax Cuts and Jobs Act (TCJA) that Congress signed into law on December 22, 2017. However, the job-related expenses deduction is still available to people who work in one of these specific professions or situations:

• Armed Forces reservist
• Qualified performing artist
• Fee-basis state or local government official
• You're disabled and have impairment-related expenses

Additionally, job-related expenses may be deductible in your state. Enter your expenses and we’ll figure out if you can deduct them.

Expenses that qualify for this deduction are those the IRS considers "ordinary and necessary" for work, like uniforms, tools, union dues, licenses, and travel between job sites.

Related Information:

• What is the 2% rule?
• Where do I enter job-related employee expenses? (Form 2106)
• Can employees deduct commuting expenses like gas, mileage, fares, and tolls?
• Which federal tax deductions have been suspended by tax reform?

[amir_natan]

Yes, I know that. The question is not deducting expenses from the W-2 income. Let’s assume I didn’t have ANY income this year but only expenses. Can I write them off somewhere? I wrote them off last year. 

[Carl]

If the 'statutory employee" box is checked on the W-2, you will still enter the W-2 in the W-2 section. You will """NOT""" enter that income again anywhere else in the program. But you will be able to deduct your SCH C expenses against it and you will not have to do anything special.

If the "statutory employee" box is not checked, then you can not deduct any expenses against that income. Period.

[jtax]

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@amir_natan wrote:

Yes, I know that. The question is not deducting expenses from the W-2 income. Let’s assume I didn’t have ANY income this year but only expenses. Can I write them off somewhere? I wrote them off last year. 

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Only if they are for an active trade or business that is what I'll call serious business and not a "hobby."  (Then on a Schedule C.) If it is a hobby you can only deduct expenses up to your income in that business (income here does not include W2 income). I.e. you cannot use hobby losses to reduce your other income.

Figuring out if you are a business or hobby is not easy. There are nine factors and nothing is black and white. Except that there is a "safe harbor" - you are conducting a business and not a hobby if you have a profit in three of the last five years. The basic rule is that if you are losing money you have to be very serious (plans, research, etc.) and likely to turn a profit.

See if this article helps you:

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

[TomD8]

A taxpayer cannot use Schedule C to deduct expenses related to W2 income (statutory employees excepted).

But a taxpayer who has an established self-employed business (and normally files Schedule C) can still deduct (on Schedule C) expenses legitimately related to that business even if they have no income from that business in a given year.  Example: an established commission-only real estate agent who has no sales in a given year, but still has expenses such as internet usage, realty association fees, business vehicle usage, advertising, etc., can still deduct those expenses on Schedule C, even with zero real estate income.  But if that same realtor had a side job for which he or she received a W2, any expenses related to that W2 job would NOT be deductible.  

[amir_natan]

The question is deducting expenses in this line of work not expenses specifically for those W-2. You can do something and get W-2, 1099 and cash. Those are different income possibilities. The expenses you had in the year are $1000. Only $200 are relayed to the W-2. The other $800 are for the other gigs you did NOT get W-2 for. In this specific year I didn’t have those 1099/cash income but I still had the $800 expenses. I change in the law is about deducting expenses for W-2 wages and not about deducting all expenses of line of work. 

[amir_natan]

Thank you. Very helpful!