Uber, Lyft, Ride Share
If you work as an Uber, Lyft, Ride Share driver, you are essentially working as a self-employed or as an independent contractor. All the independent contractors and entrepreneurs receive a 1099 form each year rather than the W-2 form for tax filing. Contrary to the traditionally employee or part-time worker, Uber, Lyft, RideShare does not withhold taxes from your incomes. This is why it’s important for you to pay your income tax and self-employment tax every year to the government.
Becoming an independent contractor comes with a set of certain benefits. Most importantly, it’s your rights that, you can exclude your expenditures from your gross income and the pay taxes on the net income. Therefore, it’s important to keep track of your mileage and vehicular maintenances costs, working hours and supplies which can lead to bunch of savings.
Grubhub, Door Dash, Amazon, Instacart
As a Grubhub,Door Dash,Amazon,Instacart driver, you are working as an on- demand Food Delivery Driver which counts as an independent contractor. Due to the very reason, you’ll receive a 1099 form each year instead of the W-2 as per previous routines.
On-demand food businesses can hire drivers to make deliveries or recruit them as independent contractors. As an Independent contractors you are required to pay their own taxes as you go by approximating the tax you owe and sending the IRS regular payments during the course of the year.
Since, food-delivery drivers typicallyexpend their own money on the job, so theycanwithhold certain on-the-job costs at taxation time that includes Phone bills, Gas and mileage costs. Your tracked expenses can reduce the amount of your profits that’s dutiable—which lowers your entire tax bill and increases your revenues.Therefore it is recommendedtoitemize youroutlays when they will surpass the standard deduction you’re permitted for your filing status.
Social Media Money
If you’re making money off the internet, you might be working as an Influencer, Online Entrepreneur, Entertainers, Web models, Web Coaches, Trainers. Paid by PayPal CashApp, and Vimeo. Working online counts as self-employment or independent contracting to be moreprecise. All independent contractors have to pay self-employment tax which is essentially a Social Security and Medicare tax required for self-employed folks, since they do not have taxes remitted from their incomes. You will receive a 1099 form from each brand you partner with.
Similar to all independent contractors, freelancers and online workers’ job can require a wide variety of expenses which are tax deductible as long as these expenses are “ordinary and necessary” for your job. These expenses contain computers, tablets, and smartphones, cameras and other filming equipment, editing software, website domain costs, supplies, and Mileage. . .
Transportation industry involves truck drivers, transporters, delivery, and driver services. Most company employed drivers will get a W-2 form that reports their earnings. Drivers will report this revenue on Form 1040. However, if you are working as an independent contractor for a firm, you will receive Form 1099 which is used to report varied income.
The IRS lets truck drivers to exclude “ordinary and necessary” business expenditures. This can differ even on a discrete level, however, some outlays are normally accepted. These expenditures contain truck repairs, union or professional association charges, uniforms, office supplies, sleeper berth,electronic devices, travel costs and On-the-job tolls.
As a nurse, nursing assistant or a hospital employee you are eligible to pay taxes using aWage and Tax Statement commonly named as W-2 form. However, all the employees including nurses and doctors are entitled to certain benefitsand you may be eligible for more tax deductions as a working nurse than you realize. These deductions can be seen on your form, however, it’s recommended to always check the IRS website for a complete list of permissibletax deductions.
Since you are a hospital employee, you can write off Items purchased for your job,Licensure and union dues, Tuition and fees deduction, student loans, Travel, and work-related expenses. Furthermore, it’s important to mention here that, you need to know the difference between an itemized and a standard deduction since you can can’t choose both.
Real Estate investors
US tax code can be bit complex when it comes to Real estate taxation. Wholesaler, Flippers, AirBNB Hosts can use their investment properties to generate rental income. Rental income makes you an independent contractor and you will receive a 1099 form for filing.
Similar to other businesses that are run through self-employment and contracting, property owners can exclude their expenses from the generated revenue and pay taxes on the net income. These deductions can include maintenance costs, insurance, mortgage interest, property management fees, HOA dues, property taxes, and utilities costs that owners pay.
Skilled Contractor Services
For taxation, it’s important to determine whether the worker is legally a contractor, freelancer, or a regular employee. Generally, the Skilled Contractor Services include Contractors,Electrician,HVAC, Builders, Roofers, and Handyman. If these people are self-employed, they will receive 1099 form instead of W-2 form because they are all self-employed contractors holding a business, either as the sole owner or partner in ownership.
The skilled contractors are exempt from paying taxes on work-related expenses. For example, electricians, builders and mechanics buy tools and uniforms for their work. They all have expenses for equipment and services used in the trade, and which they can deduct expenses related to work and pay taxes on net income.
Employers must deposit and report employment taxes. If you are working for an airline and hotel industries, it’s likely you will receive a W-2 form only if you are a regular employees to the organization. It is also important to mention here that employers generally must withhold part of social security and Medicare taxes from employees’ wages and they pay a matching amount themselves using a W-4 form.
Furthermore, if we look from the perspective of independent contracting, if you own the airline or hotel businesses you are self-employed and have to pay the social security and Medicare taxes using the 1099 form. You taxed income is also exempt from your work-related expenses which might include material costs, travel costs, supplies and miscellaneous on-the-job outlays.
Airport industry employs variety of workers for different jobs. These employees include baggage claimers, fuelers and airline crews. Since all these employees are hired by the airline business, they are not independent contractors and hence they receive W-2 form.
Bartender, Servers, Waiter/Waitress
Restaurant Industry is flourishing in America. Bartending, serving, waiting has become popular jobs for students for making quick cash. Since most of them are part-timers, they count as independent contractors, while if they are permanent employees working for a certain restaurant they will receive the W-4 form. The independent contractors receive 1099 form.
It is important to mention that, bartenders, servers, and waiters must also account for cash tips. They need to keep good records of their tips or report them to their employer for their record keeping. Even if reported to their employer, they should still keep their own records, in case there’s a significant discrepancy between what they believe they made versus what their employer reports.