Has anyone used Cash App's tax reporting features? I know they have some built-in tools for business accounts but idk if those help with personal accounts too?

Just to add another perspective - I was in a similar boat last year with about $2,800 from freelance graphic design work through Cash App. I ended up going the Schedule C route and it was definitely the right choice. Even though it seemed more complicated at first, I was able to deduct things like my Adobe subscription, art supplies, and even a portion of my home internet bill since I work from home. Those deductions saved me way more than I would have saved by just reporting it as "other income" on Schedule 1. The key thing that helped me was keeping really detailed records throughout the year - I created a simple spreadsheet tracking each payment, what it was for, and any related expenses. When tax time came, everything was already organized and ready to go. Don't stress too much about the audit risk - as long as you're honest and have documentation, you'll be fine!

I'm dealing with this exact same frustrating situation right now! Got my CP01H letter last month, completed the ID.me verification online (which took forever), and then got ANOTHER letter saying I need to call. It's so confusing that they don't explain these are two separate processes. Based on all the responses here, it sounds like I definitely need to make that call. Really appreciate everyone sharing their experiences - at least now I know what to expect. Going to try calling early tomorrow morning with my tax returns ready. Fingers crossed I can get through without waiting hours on hold!

I just went through this exact nightmare myself! The IRS verification system is absolutely broken. I did the ID.me verification thinking I was all set, then got the CP01H letter demanding a phone call. Spent 3 days trying to get through before finally connecting. The agent explained that the online verification only confirms your identity for accessing IRS online services, while the phone verification is specifically for processing your tax return - they're completely separate systems that don't talk to each other at all. It's mind-boggling that they don't explain this clearly in their letters. After the phone verification, my refund was processed in about 10 days. Definitely call as early as possible (7am when they open) and have your last 2 years of returns ready. They'll ask very specific questions about previous filing amounts and dates. Hang in there - once you get through the phone verification, it moves pretty fast!

Just wanted to share my experience as someone who's been through this exact situation! I started selling digital content (similar situation to yours) about two years ago and was terrified about the tax implications. The biggest thing that helped me was realizing that from the IRS perspective, this is just self-employment income like any other side business. Whether you're selling feet pics, tutoring, or making crafts - the tax treatment is identical. Here's what I learned that might help: 1) Keep meticulous records from day one. I use a simple spreadsheet tracking every payment received and any business expenses (props, camera equipment, editing apps, etc.) 2) The alias situation is totally manageable. I've been using a stage name for two years with no issues. Just make sure you can clearly document that the income belongs to you. 3) Consider your payment platform carefully. I had to switch away from PayPal after they became problematic about content policies, even for non-explicit material. 4) Set aside 30% of earnings immediately for taxes. I put mine in a separate savings account so I'm not tempted to spend it. 5) Don't overthink the business description on tax forms. "Digital Content Creation" or "Photography Sales" works perfectly fine. The privacy concerns are valid, but remember that tax records are confidential. Future employers won't see your tax returns or know what specific products you sold to earn income. You've got this! Student loans are crushing, and there's no shame in finding creative legal ways to pay them down faster.

I want to emphasize something important that others have touched on but bears repeating - you absolutely need to treat this as legitimate self-employment income from day one, regardless of what you're selling. I work as a tax preparer and see people in similar situations regularly. The IRS doesn't care about the nature of your legal business - they care about accurate reporting and proper tax compliance. Here are some key points: 1) Document everything meticulously. Bank statements, payment platform records, expense receipts - keep it all organized by tax year. 2) If using an alias, maintain clear documentation linking that alias to your SSN. Screenshots of payment transfers, account statements, anything that shows the connection. 3) Open a separate bank account for business income, even if it's under your real name. This separation makes record-keeping much cleaner and shows the IRS you're treating this professionally. 4) Calculate and pay quarterly estimated taxes if you expect to owe $1,000+ annually. Use Form 1040-ES or work with a tax professional to avoid underpayment penalties. 5) Track deductible expenses: photography equipment, props, software subscriptions, portion of internet/phone bills used for business, even a portion of rent if you use part of your home exclusively for this work. The privacy concerns are understandable, but tax filings are confidential. Your Schedule C will simply show "Digital Content Creation" or similar - no one will know specifics about your products. Consider consulting with a tax professional for your first year to ensure everything is set up correctly. The peace of mind is worth the cost, especially when dealing with student loan debt stress. You're taking a proactive approach to your financial situation - that's commendable. Just make sure you're protecting yourself legally and financially from the start.

This situation is unfortunately more common than it should be, especially with small businesses. Here are some immediate steps you can take: 1. **Document everything** - Take photos of your checks and keep a detailed log of hours worked vs. pay received. This will be crucial evidence if you need to file complaints. 2. **Request a meeting** - Ask your boss for a sit-down conversation about payroll. Come prepared with specific questions: "Can you show me how you calculate my withholdings?" and "When will I receive my W-2 for tax filing?" 3. **Know your rights** - Your employer is legally required to provide you with a paystub showing gross pay, all deductions, and net pay. In many states, this is mandated by law regardless of business size. 4. **Contact your state's Department of Labor** - They can investigate wage and hour violations and often have resources specifically for situations like this. Many have anonymous tip lines. 5. **Start setting aside money NOW** - Assume you'll owe taxes on your full gross income and save accordingly. Better to be prepared than caught off guard. The fact that you never filled out a W-4 is a major red flag. Don't let the fear of losing your job prevent you from protecting yourself financially. Your boss's evasive behavior suggests he knows he's not handling this properly.

This is a really concerning situation, and you're absolutely right to question what's happening. As someone who's dealt with payroll issues before, here are some red flags I'm seeing: 1. **No W-4 form** - This should have been the very first thing you filled out when starting work. Without it, your employer has no legal basis for withholding taxes. 2. **No paystubs** - Even the smallest businesses are required to provide documentation of what's being withheld from your pay. The fact that he's just writing personal checks without any breakdown is highly irregular. 3. **Evasive behavior** - A legitimate employer would be happy to explain their payroll process and show you exactly where your tax money is going. I'd strongly recommend starting with the basics: send your boss a text or email requesting copies of your W-4 and paystubs for all pay periods. Having this in writing creates a paper trail. If he can't or won't provide these basic documents, that tells you everything you need to know. Also, start calculating and setting aside about 25-30% of your gross pay for taxes, just in case. You don't want to be stuck with a huge tax bill if it turns out he's been pocketing your withholdings instead of sending them to the IRS. Your instincts are spot on - trust them and protect yourself!

This is such a common confusion point! I dealt with the exact same issue when I first started getting dividend income. The key thing that finally clicked for me is that the 1040 form itself is just collecting the information - the actual preferential tax treatment happens "behind the scenes" in that worksheet calculation. Think of it this way: Line 3a (qualified dividends) is like flagging "hey, some of my dividend income deserves special treatment" and Line 3b (ordinary dividends) goes into your total income like any other income. But when you get to calculating your actual tax liability on Line 16, that's when the magic happens - the worksheet takes your qualified dividend amount and applies the lower rates (0%, 15%, or 20%) instead of your regular income tax rate. I always tell people to double-check that their 1099-DIV amounts match what they're entering. Box 1a goes to Line 3b, and Box 1b (which should be included in Box 1a) goes to Line 3a. The difference between those two amounts represents your non-qualified dividends that get taxed at regular rates.

I went through this exact same confusion last year! What really helped me was understanding that the 1040 form is essentially just collecting information in two buckets - your qualified dividends (line 3a) and your total ordinary dividends (line 3b). The actual tax magic happens later. Here's the step-by-step that finally made it click for me: 1. Report $7,200 on line 3b (total ordinary dividends from Box 1a) 2. Report $5,900 on line 3a (qualified dividends from Box 1b) 3. The $7,200 gets included in your total income on line 9 4. When you get to line 16 (Tax), the instructions will direct you to the Qualified Dividends and Capital Gain Tax Worksheet 5. That worksheet takes your $5,900 and applies the preferential rates (0%, 15%, or 20%) while the remaining $1,300 gets taxed at your regular income rate The worksheet is in your 1040 instruction booklet under the line 16 section. Don't worry about finding it now - when you get to line 16, the instructions will clearly tell you to use it if you have an amount on line 3a. The key insight is that qualified dividends still count as income for calculation purposes, but they get their special tax treatment during the final tax computation step, not by being excluded from income.