Self-Employment and Disability

[ArizonaLady1958]

Disabled Veteran and his wife married filing jointly - disability is their only income.  He started driving for Lyft in 4th quarter 2018 and so far made a little over 3000.00.  Does he need to file a return?  I think he does since he will get a 1099 from Lyft 

[Carl]

Yes, you are required by law to file a tax return because you have more than $400 of self-employment income. You *WILL* pay the self-employment tax on the amount over $400. But you will not pay any "regular" income tax.

Note that your disability pay from the veterans administration is not reportable on any tax return, ever. Additionally,  even if only one of you had reportable income in 2018, you still file a joint return.

So the only thing you'll be paying is the 15.3% self-employment tax, and that's pretty much it. The SE tax is basically the employer's side of your social security and Medicare and gets credited directly to the SS account of the person who owns the business as will be identified by you on the SCH C.

[ArizonaLady1958]

Thanks - that's what I thought.  It's not mine.  It's a friend and her husband.  I know about the SE and all the business tax issues for my own business but was unsure about the personal and disability part.   I ended up directing them to a local VITA tax office for assistance

[Carl]

For veterans, disabled or not, a lot of the local RAO (Retiree Activities Office) will have free tax filing assistance during the filing season, starting usually around the 2nd week of Jan. So of there's an RAO in the area that would be more convenient considering their disability, it might be worth at least checking it out.

[ArizonaLady1958]

I referred them to VITA - they're good now thanks