Tax season officially begins for many of us on Jan. 27, and the Gig Economy has changed the way Americans work and earn money.
This year, the IRS launched a new gig economy tax center, but what exactly is the gig economy?
The short answer is: it’s when people earn income by providing on-demand work, services or goods.
It’s often through a digital platform like an app or website.
There are many types of gig economy businesses, but independent contractors or people who drive for Uber and Lyft are some of the most popular.
Many of these workers do not get W-2 forms or 1099’s. The new gig economy center gives tips and resources to make sure these workers meet their requirements.
A few of those tips include:
1. Make sure you collect and keep your records and receipts throughout the year.
2. If you earn money for gig work as an independent contractor, you may have to pay quarterly estimated taxes.
3. Make sure you collect income forms because those businesses you work for may send those forms to the IRS.
4. Don’t forget to fill out the proper forms like a 1040 return.
The new center also helps people if they manage taxes for a digital platform.
That includes ride-share or delivery service, on demand repair services and property and space rentals like Airbnb.