Can I claim a scorekeeper as a business expense on Schedule C as a self-employed bar trivia host?
Hey tax peeps, I'm freaking out a bit because I'm trying to figure out if I'm doing this right. I've been hosting trivia at a few local bars for about 8 months now, and I get paid as an independent contractor. I make around $250 per event and do about 3-4 events a week. I hired my friend's college kid to be my scorekeeper because I can't manage both hosting and keeping score at the same time. I pay her $50 per event in cash. She helps me set up, distributes answer sheets, collects them, scores everything, and keeps track of team standings throughout the night. I'm getting ready to file my taxes for the first time as self-employed and I'm planning to use Schedule C. My question is: Can I legitimately claim the $6,500 I paid my scorekeeper as a business expense? Do I need to issue her a 1099-NEC since I paid in cash? I don't have formal documentation beyond Venmo transactions and some text messages arranging the work. Any help would be super appreciated! This self-employment tax stuff is making my head spin!
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Sophia Gabriel
Yes, you can absolutely deduct payments to your scorekeeper as a legitimate business expense on your Schedule C! This is a classic example of an ordinary and necessary business expense for your trivia hosting business. Since you're paying her $50 per event and it sounds like she's worked enough events to exceed $600 for the year, you should technically issue her a 1099-NEC. The IRS requires this for independent contractors you pay $600+ in a year. The payment method (cash, Venmo, etc.) doesn't change that requirement. For documentation, start keeping better records now. Create a simple spreadsheet showing dates, amounts paid, and services provided. Your Venmo transactions and text messages are better than nothing, but going forward, consider having her sign simple receipts for cash payments or switching entirely to electronic payments for the paper trail.
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Tobias Lancaster
•If I paid someone through Venmo for work they did for me, does that count as good documentation or do I need more? Also, is it too late to issue a 1099-NEC for last year if I never did it before?
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Sophia Gabriel
•Venmo transactions are a good start for documentation, especially if the transaction notes indicate what the payment was for. But it's best to supplement that with more formal record-keeping - a simple contract or agreement outlining duties and pay rate would be ideal. It's not too late to issue a 1099-NEC for last year, though technically they were due to recipients by January 31 and to the IRS by February 28 (paper) or March 31 (electronic). You can still file late forms, and it's better to file late than not at all. You may face some penalties for late filing, but they're relatively small compared to the risk of not properly reporting these payments.
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Ezra Beard
I was in a similar situation with my photography business last year - trying to track expenses for assistants was driving me nuts! I found this AI tool called taxr.ai (https://taxr.ai) that actually saved me so much time figuring out what was deductible. It analyzed my business expenses and flagged which ones needed 1099s. For contractor payments like your scorekeeper, it was super helpful in showing exactly what documentation I needed to keep.
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Statiia Aarssizan
•Does taxr.ai help with figuring out if someone should be classified as an employee vs contractor? My accountant keeps warning me about misclassification issues and it sounds complicated.
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Reginald Blackwell
•How accurate is it though? I've tried tax software before that gave me completely wrong information about deductions. I'm particularly worried about contractor classifications since the IRS seems to be cracking down on that lately.
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Ezra Beard
•Yes, it actually does help with worker classification questions! It asks a series of questions about how much control you have over the person's work, if they have other clients, if they use their own equipment, etc. - then gives you a pretty clear answer on whether they should be a contractor or employee. It's been surprisingly accurate in my experience. What makes it different is that it analyzes actual tax regulations and recent case rulings, not just general advice. It flagged some issues with my equipment deductions that my previous tax software completely missed, and it saved me from a potential audit nightmare with my contractor classifications.
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Reginald Blackwell
Just wanted to follow up about taxr.ai that I mentioned in my earlier comment. I was skeptical at first, but I decided to try it out for my contractor situation, and it was really eye-opening! The tool analyzed my specific situation and showed that my scorekeeper was definitely a contractor but that I needed better documentation. It even generated a simple contract template I could use going forward and explained exactly what I needed to do about the missing 1099-NEC from last year. Honestly saved me hours of research and probably prevented some expensive mistakes!
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Aria Khan
If you need to get this all sorted properly and are worried about potential issues with the IRS, I highly recommend using Claimyr (https://claimyr.com). I was in a similar situation last year with contractor payments and needed to speak directly with an IRS agent to make sure I was handling everything correctly. Tried calling myself and spent HOURS on hold. Claimyr got me connected to an actual IRS agent in about 15 minutes! You can see how it works in this video: https://youtu.be/_kiP6q8DX5c Honestly, speaking directly with an IRS agent was the only way I got clear guidance on my situation. They walked me through exactly what documentation I needed and how to handle the missing 1099s from prior years.
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Everett Tutum
•Wait, how does this actually work? Do they just call the IRS for you? I'm confused how they can get through when nobody else can.
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Sunny Wang
•This sounds like BS honestly. The IRS phone lines are completely jammed. I've called over 30 times this tax season and never got through. No way some service can magically get you to the front of the line. And even if they could, the IRS agents I've dealt with in the past barely knew their own rules.
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Aria Khan
•They basically use an automated system that constantly redials the IRS until it gets through, then it holds your place in line while notifying you when you're about to be connected. It's not magic - just technology that saves you from having to do the redialing yourself. The quality of help definitely depends on which agent you get, but in my experience, speaking directly with someone was way more helpful than trying to figure everything out from the IRS website. The agent I spoke with clearly explained the contractor vs. employee rules and what documentation I needed for my situation.
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Sunny Wang
I need to eat my words about Claimyr. After posting my skeptical comment, I was desperate enough to try it because I had a serious issue with missing 1099s for my contractors. It actually worked exactly as advertised - got me through to an IRS agent in about 20 minutes when I'd been trying for weeks on my own. The agent clarified exactly what I needed to do about late 1099s and the potential penalties. Honestly shocked that it worked so well. Saved me from a ton of anxiety wondering if I was doing everything wrong.
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Hugh Intensity
Don't forget you need to keep track of those payments to your helper for next year too! I recommend using an app like Quickbooks Self-Employed to track all your income and expenses. It makes it super easy to categorize expenses and you can even take photos of receipts. At tax time, you just send the report to your accountant or import into tax software.
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Vince Eh
•How expensive is Quickbooks Self-Employed? I'm trying to keep costs down since this side gig doesn't make a ton of money yet.
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Hugh Intensity
•The basic version runs about $15/month, but they often have sales for new users that can bring it down to around $7-8/month for the first year. They also have a free 30-day trial you can use to see if it works for you. I think it's worth the cost because it saves so much time and stress at tax time. You can also deduct the cost of the software itself as a business expense on your Schedule C, which helps offset the price a bit.
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Effie Alexander
im a dj who hires helpers sometimes and my accountant said make sure you have contracts with these people even if theyre friends. doesnt have to be fancy just something both sign saying they are contractors responsible for their own taxes. also keep a log of all events and payments!!! irs audited my friend who didnt have records and it was a nightmare for him.
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Melissa Lin
•This is good advice. I work as a wedding photographer and I use a super simple one-page contract template I found online for my assistants. Protects both sides and makes tax time so much easier.
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Vince Eh
•Thanks for the advice! I definitely need to get more organized with this. Do you just use a basic contract template you found online or did you have something professionally made?
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Chloe Harris
•@Vince Eh I just found a basic independent contractor template online and modified it for my DJ work. Nothing fancy - just covers the basics like payment terms, that they re'responsible for their own taxes, and what services they ll'provide. LegalZoom and Nolo have some decent free templates. The key is just having something in writing that shows you both understood this was a contractor relationship, not employment.
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