Tax Return Filing for On-Demand Workers

Last year, I wrote a blog for Henry + Horne about how slow the IRS has been to adapt to the on-demand economy. In it, I quoted a report from the Kogod Tax Policy Center that found:

  • 1/3 of on-demand workers did not know whether they were required to file quarterly estimated tax payments
  • 36% were not familiar with the kinds of records they would need to maintain to substantiate income and expenses for their work
  • 43% had no idea how much they would owe in tax for their on-demand work and had not set aside money for taxes
  • 1/2 were unfamiliar with deductions and credits that could be used to offset their self-employment income

 

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(Image: Dan Gold via Unsplash)

 

Last year, I worked with a young lady that drove for one of the ride-sharing companies and got into a bit of tax trouble. It seems she never received a 1099 from the company and wasn’t aware that the money she made was taxable income, so she didn’t do a good job of tracking expenses. A couple years later, she received a notice from the IRS telling her she owed thousands of dollars in back taxes, interest, and penalties.

Fortunately, we were able to help her recreate her records enough to have some documented expenses to offset that income and get her tax bill lowered. But the situation just reinforced how little information many of these workers receive about the tax implications of the gig economy.

So I was excited to write this piece for Credit Karma Tax, providing step-by-step instructions for on-demand workers to file their tax return – for free! – using Credit Karma Tax.

All you need to do is sign up for a free Credit Karma account and follow the instructions to report business income from any 1099-MISCs and 1099-Ks you receive from any ride-share companies and any income you earned from ride-sharing work that wasn’t reported on a 1099.

If you know anyone working in the gig economy, feel free to pass this along!

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How Do Millennial Business Owners Compare to Other Generations?

Will we ever tire of analyzing, dissecting and writing about the Millennial generation? Not anytime soon.pexels-photo-159991

Recently, I wrote a piece for Freshbooks on how Millennial business owners compare to other generations. Researching this piece was pretty interesting. I uncovered a few statistics that surprised me.

I also listed a few resources to help small business owners (of any generation) manage their business finances.

Head over to the Freshbooks blog and check it out. Do you have any other tips I didn’t think of?

Tax Knowledge Showdown: How Do Millennial Business Owners Compare to Other Generations?

(Image: Alicia Zinn via pexels)

Majority of Small Businesses Unprepared for Cash Crisis

A couple months ago, I had the opportunity to write for Chase News & Stories about a new study from the JPMorgan Chase Institute that analyzed data from nearly 600,000 small businesses and found that only about half of small businesses maintain a cash buffer large enough to support 27 days of typical cash outflows.

 

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Image: Jeff Weese via pexels

I had a tight deadline for this piece, and I needed to find a small business owner willing to discuss cash flow – not exactly a topic that many small business owners want to publicly admit they struggle with. Fortunately, I have a connection to Neva Peterson of Neva Knows Business, a bookkeeping and consulting business in Las Vegas, Nevada.

 

I’ve been friends with Neva’s daughter, Jennifer since junior high school, so she was willing to open up about her experiences starting her own small business and dealing with cash flow while growing her business and hiring employees. Her thoughts are not only insightful but pretty entertaining!

You can check out the piece here.