As a personal assistant, should I file taxes under business income or miscellaneous?

What about the education credits they mentioned? Will those completely offset the self-employment taxes? And do they need to file quarterly estimated taxes for next year?

Education credits like the American Opportunity Credit or Lifetime Learning Credit can help offset your income tax liability, but unfortunately they don't reduce your self-employment tax obligation. These are separate calculations on your return. Depending on your qualified education expenses, these credits might help with the income tax portion, but you'll still likely owe the self-employment taxes. Regarding quarterly taxes, yes - if you expect to owe at least $1,000 in taxes for 2025, you should be making quarterly estimated tax payments. Since you haven't had any withholding, it would be wise to start making these payments to avoid an underpayment penalty when you file next year.

Does it actually work with personal assistant situations specifically? I'm in the same boat and I'm worried my situation is too unique.

I'm skeptical... don't most tax software programs already do this? How is this any different from what TurboTax would tell you?

Yes, it absolutely works with personal assistant situations! That's exactly what I used it for. They have experience with all sorts of non-traditional jobs and gig work. They'll help you determine if you should file Schedule C and what specific deductions apply to personal assistants. It's definitely different from regular tax software. TurboTax asks you questions but doesn't analyze your specific situation for potential mistakes or missed opportunities. This service actually reviews everything and catches stuff the regular programs miss. For me, they identified transportation deductions between clients that TurboTax never prompted me about, and they explained exactly how to document everything properly for self-employment.

How does this actually work? Do they have some special connection to the IRS or something? Seems weird that a third party could get you through faster.

Yeah right. There's no way this works. The IRS phone system is deliberately designed to be impenetrable. I've tried calling dozens of times about my small business taxes and it's just a black hole.

It works by using technology to navigate the IRS phone tree and wait in the queue for you. They don't have special access - they just handle the waiting part so you don't have to sit with a phone to your ear for hours. When they're about to connect with an agent, they call you and connect you directly to that agent who's on the line. I was super skeptical too until I tried it. The thing is, the IRS phone system isn't actually designed to be impenetrable - it's just overwhelmed. It's definitely possible to get through if you're willing to spend hours waiting, which is exactly what this service does for you. In my case, I used it because I needed to arrange a payment plan for self-employment taxes I hadn't been paying (similar to the original poster's situation).

No tax forms at all, which is part of what's confusing me. I've just been getting paid directly to my bank account. When I asked about it, they said since I'm "just helping out" they didn't think they needed to provide anything. I'll definitely ask them more directly about this. Do you think I should request a 1099 from them?

Yes, you should definitely request a 1099-NEC from them. They're actually required to provide one if they paid you $600 or more during the year as an independent contractor. If they're not treating you as an employee with a W-2, then the 1099-NEC is the correct form. Even if they don't provide a 1099, you still need to report all your income. The IRS has a matching system where they can see deposits to your accounts, so it's important to declare everything. Without a 1099, you'd report it the same way on Schedule C, but you'll need to keep good records of all payments received in case of questions later.

Can you really deduct part of your cell phone as a PA? I've been paying for a separate "work phone" thinking that was the only way to get the deduction!

Yes! You can absolutely deduct the business portion of your personal cell phone. You don't need a separate work phone. Just calculate what percentage you use it for work vs personal and deduct that percentage of your monthly bill. For example, if you use your phone 40% for work calls/texts with clients, you can deduct 40% of your phone bill as a business expense. Keep good records though - track work calls/texts for at least a few months to establish the percentage. Way easier than maintaining two phones!

This is really helpful advice about the financial aid impact! I hadn't even thought about how self-employment income might affect my FAFSA. Do you know if there's a significant difference in how they treat self-employment income versus regular W-2 wages when calculating EFC? I'm already on a pretty tight budget with school and this job, so I want to make sure I'm not accidentally hurting my financial aid eligibility for next year. Also, the retirement account idea is interesting but seems like it might be overkill for someone only making $16k? Though I guess every little bit helps with taxes.

@Eve Freeman The FAFSA does treat self-employment income a bit differently than W-2 wages. Self-employment income gets reported on the FAFSA, but you can also deduct legitimate business expenses, which might actually lower your adjusted gross income compared to if you had the same amount in W-2 wages. The key is making sure you re'accurately reporting both your income and allowable deductions. Regarding the retirement account - you re'right that $16k isn t'huge, but even contributing $1000-2000 to a SEP-IRA could save you several hundred in taxes while building good savings habits. Plus as a self-employed person, you can contribute up to 25% of your net self-employment earnings, which gives you more flexibility than traditional employee retirement accounts. Something to consider if you continue this work and your income grows!

This is such a comprehensive breakdown, thank you! I'm actually dealing with something similar right now - just started working as a personal assistant for a busy executive and I've been wondering about the tax implications. The self-employment tax calculation is honestly a bit scary when you put it like that ($2,400 on $16k is significant!), but I guess that's just part of being self-employed. One question - you mentioned tracking mileage for errands but not commuting. How do you distinguish between the two? Like if I drive to their house to pick up their dry cleaning and then drop it off, is that all deductible mileage or just the part where I'm actually running the errand? I've been keeping a mileage log but I'm not 100% sure I'm categorizing everything correctly. Also, do you happen to know if there's a minimum amount you need to earn before quarterly payments become mandatory? I'm only working part-time right now but planning to increase my hours over the summer.

@Jamal Washington Great questions! For mileage deduction, the key is distinguishing between commuting getting (to your regular workplace vs.) business travel. If you regularly work at the family s'house, then driving there would be considered commuting and not deductible. However, once you re'at "work and" driving to run errands for them dry (cleaning, grocery store, etc. ,)that mileage IS deductible. So in your example, driving to their house wouldn t'count, but driving from their house to the dry cleaner and back would be deductible business mileage. If you work from multiple locations or your work involves traveling between different places not (just one regular workplace ,)the rules can be more flexible. The IRS looks at whether the travel is ordinary and necessary for your business. Regarding quarterly payments - you re'required to make estimated quarterly payments if you expect to owe $1,000 or more in taxes when you file your return. This includes both income tax and self-employment tax. Given that self-employment tax alone is 15.3%, you d'hit that threshold pretty quickly. For reference, if you make around $7,000-8,000 in net self-employment income, you re'probably looking at owing over $1,000 total. Keep that mileage log detailed - date, destination, business purpose, and miles. It ll'save you headaches if the IRS ever asks questions!

This is really thorough advice! I'm in a similar situation as a personal assistant and had no idea about the home office deduction possibility. When you mention doing scheduling/admin work from home qualifying for the home office deduction, do you know what percentage of home expenses can typically be deducted? I do a lot of calendar management and correspondence from my apartment, but I don't have a dedicated office space - I usually work from my kitchen table or couch. Does it still qualify if you don't have a separate room exclusively for work? Also, the quarterly payment requirement is something I definitely need to research more. If I'm just starting out and not sure how much I'll make this year, is there a safe way to estimate those payments without overpaying?

@Aaron Lee Great questions! For the home office deduction, you unfortunately do need to use a specific area of your home regularly "and exclusively for" business to qualify. The IRS is pretty strict about this - working from your kitchen table or couch typically won t'qualify because those spaces aren t'used exclusively for work. However, if you have even a corner of a room that you use only for work like (a desk area ,)you might be able to claim that square footage. You can calculate it either by percentage of total home square footage used for business, or use the simplified method which allows up to $5 per square foot of office space max (300 sq ft = $1,500 deduction .)But again, it has to be exclusive business use. For quarterly payments, a safe approach is to pay 100% of what you owed in taxes last year or (110% if your AGI was over $150k .)This protects you from underpayment penalties even if you end up owing more. Since this might be your first year with significant self-employment income, you could also estimate based on your expected annual income and pay 25% of that estimated tax liability each quarter. The IRS has Form 1040ES with worksheets to help calculate this. Start conservative - it s'better to get a refund than owe penalties!