How does being self-employed affect my taxes?

For starters, you'll probably receive some different tax forms in the mail.

Form 1099-MISC or 1099-NEC reports money you earned doing work for a client or for a company as a nonemployee. Think of it as the self-employed equivalent of Form W-2. If someone paid you $600 or more for non-employee work, they're required to send you a 1099-NEC.

Form 1099-K tracks income you made from selling goods or providing services via payment apps and online marketplaces. Examples include PayPal, Venmo, Square, Etsy, Uber, and Ebay.

You should receive a 1099-K if you made more than $5,000 on one of these platforms.

Even if you don't receive a 1099-K, or you make less than $5,000, you still need to report all taxable income to the IRS.

You're required to report all self-employed income – including cash, check, and electronic payments – even if you didn't get a 1099.

As a self-employed taxpayer, you'll also see some new forms on your tax return. We'll automatically fill these out for you in TurboTax.

• Schedule C: This calculates your net profit or loss, which carries over to Schedule 1, line 3.
• Schedule SE: This calculates your self-employment tax, which shows up on Schedule 2, line 4. You get to deduct half of it; that amount transfers over to Schedule 1, line 15.
• 1040-ES: We'll generate four of these estimated payment vouchers, one for each quarter, if (like many newly self-employed people) you didn't withhold or pay enough taxes throughout the year. These vouchers are for next year's return, in case you need them.