You must file a tax return if you have net earnings from self-employment of $400 or more from gig work, even if it’s a side job, part-time or temporary.
You must pay tax on income you earn from gig work. If you do gig work as an employee, your employer should withhold tax from your paycheck. If you do gig work as an independent contractor, you may have to pay estimated taxes. Unsure if you are an employee or independent contractor? Ask your employer,
What is Gig Work?
Gig work is certain activity you do to earn income, often through an app or website (digital platform), like:
- Drive a car for booked rides or deliveries
- Rent out property or part of it
- Run errands or complete tasks
- Sell goods online
- Rent equipment
- Provide creative or professional services
- Provide other temporary, on-demand or freelance work
Note: This list does not include all types of gig work.
What to Do
Here’s how to manage taxes for gig work as an independent contractor (self-employed)
Collect and keep your records and receipts during the year. Recordkeeping can help you track your income, deduct expenses and complete your tax return.
Expenses — Save receipts of your expenses. You can lower the amount of tax you owe by deducting certain expenses. (See Get Ready to File below.)
Income — Keep records of money you receive from gig work and sales. You must report all income on your tax return, even if you don’t receive Forms 1099 from the businesses that pay you.
If you earn money for gig work as an independent contractor, you may have to pay quarterly estimated taxes. You can avoid a penalty by paying enough tax on time.
Do you work as an employee and do gig work on the side? You may avoid making estimated tax payments on your gig income by withholding more tax from your employee paycheck. Use the Tax Withholding Estimator. Then fill out a new Form W-4, Employee’s Withholding Certificate and give it to your employer.
When to pay — Estimated tax payments are due four times a year:
- April 15 for payment period January 1–March 31
- June 15 for payment period April 1–May 31
- September 15 for payment period June 1–August 31
- January 15 for payment period September 1–December 3