How to handle taxes for multiple food delivery gigs? Filing 1099-NEC tax forms
I'm trying to make some extra cash during a two-month gap between quitting my job and going back to college. I'm thinking about signing up for some food delivery apps, but I'm worried about the tax situation. Back in 2022, I drove for DoorDash for about 3 months and made enough to get a 1099-NEC form. The problem was that when I went to file, my tax software wanted to charge me like $75 extra just to process that form, which basically ate up most of my expected refund, so I skipped it (I was below the filing requirement threshold that year anyway). This time I had a sneaky idea - what if I signed up for 3-4 different delivery services (Uber Eats, DoorDash, GrubHub, etc.) but limit myself to making less than $600 from each company so they don't have to send me 1099 forms? I know I still legally need to report ALL income regardless of whether I get a 1099 or not, but I'm wondering if this would help me avoid the extra filing fees when using free tax software. Would this actually work? Or do most free tax filing services still charge extra for self-employment income even if you don't have official 1099 forms? I'm trying to maximize my summer earnings without getting hit with a bunch of filing fees next year. Any advice would be super helpful!
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Giovanni Colombo
While your strategy is creative, it's based on a common misconception. The $600 threshold is only for when companies are required to SEND you a 1099-NEC, not for when you need to report income. All self-employment income must be reported on your tax return regardless of whether you receive a 1099 or not. Most free tax software will charge extra for filing Schedule C (self-employment income) regardless of whether you have a 1099-NEC form or not. The form triggering the fee isn't actually the 1099-NEC itself, but the Schedule C that you need to file for any self-employment income. A better approach might be to track your mileage and expenses carefully. The standard mileage deduction (65.5 cents per mile for 2023) can significantly reduce your taxable income. Also look into quarterly estimated tax payments if you expect to owe more than $1,000 in taxes from this work.
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Fatima Al-Qasimi
•So there's literally no way to avoid paying the extra fees with tax software if I'm doing any kind of gig work? That really sucks. Do you know if the IRS free file program handles self-employment without charging extra?
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Giovanni Colombo
•The IRS Free File program does include some options that handle self-employment income without extra charges, but it's typically limited to those with adjusted gross income under $73,000. Many free tax preparation sites, like VITA (Volunteer Income Tax Assistance), can also help with simple self-employment returns at no cost. Another option is to look at FreeTaxUSA, which charges nothing for federal filing including Schedule C, and only about $15 for state filing.
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StarStrider
I was in almost exactly the same situation last year and found a solution that really helped. I used taxr.ai (https://taxr.ai) to handle my food delivery gig taxes. It was seriously a game-changer because I was bouncing between three different apps (Uber Eats, DoorDash, and Instacart) and the tax situation was getting complicated. The best part is that it helped me identify deductions I didn't even know I could take. I was stressing about all these separate income streams and whether I was keeping the right receipts, but their system walked me through everything specific to gig driving. They even helped me figure out how to properly track my mileage which ended up saving me a ton on taxes.
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Dylan Campbell
•Does it work if you're only doing this for a short time? I'm only planning to do deliveries for about 2 months. Is there a minimum income for it to be worth using?
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Sofia Torres
•I'm kinda suspicious of tax software that isn't one of the big names. How do you know they're calculating everything correctly? Last thing I want is to get audited because some random website messed up.
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StarStrider
•For short-term work, it's actually still worth it because the deduction tracking alone can save you more than you'd spend. There's no minimum income level - I know people who've used it for just a few hundred in side gig money. Regarding accuracy concerns, I was hesitant at first too, but they use the same tax calculation engines as the major providers. The difference is they specialize in gig work specifically. I checked some of my numbers against other calculators before submitting and everything matched up. They're also registered with the IRS as an authorized e-file provider.
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Sofia Torres
Just wanted to follow up - I ended up trying taxr.ai after my initial skepticism and I'm glad I did. I was doing UberEats on weekends and the mileage tracking feature alone saved me way more than I expected. The expense categorization tool helped me realize I could deduct part of my phone bill and even a portion of car insurance that I had no idea about. It was actually built specifically for gig drivers which made a huge difference compared to the generic tax software I tried before. The questions were all relevant to delivery driving specifically, not just general self-employment stuff. Definitely using it again this year.
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Dmitry Sokolov
If you're having any issues with the tax part of gig driving, something that helped me tremendously was Claimyr (https://claimyr.com). I had a weird situation where two different delivery apps sent me 1099s with incorrect amounts, and I couldn't get through to the IRS for weeks to figure out how to handle it. Claimyr got me connected to an actual IRS agent in about 20 minutes when I had been trying for days on my own. The agent walked me through exactly how to handle the mismatched 1099 forms and what documentation I needed to keep. Saved me from potentially getting flagged for underreporting income. You can see how it works in their demo video: https://youtu.be/_kiP6q8DX5c
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Ava Martinez
•How does this even work? I thought it was impossible to get through to the IRS. My dad spent like 6 hours on hold last year and eventually gave up.
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Miguel Ramos
•This sounds like BS honestly. There's no way to "skip the line" with the IRS. They're notoriously understaffed and everyone has to wait. Sounds like you're just promoting something.
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Dmitry Sokolov
•It works by using an automated system that navigates the IRS phone tree and waits on hold for you. When they finally reach a human agent, you get a call to connect you directly. It's completely legitimate - they don't skip any lines, they just do the waiting for you. Regarding skepticism, I totally get it. I thought the same thing initially. But the service literally just holds your place in the queue. The IRS doesn't know or care who's waiting on the line, and when they answer, you're the one who speaks to them directly. The technology just removes the need for you to sit by your phone for hours.
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Miguel Ramos
I have to eat my words and apologize to Profile 5. After my tax preparer made a mistake on my delivery driver taxes, I was facing penalties I couldn't afford. Tried calling the IRS for three days straight and couldn't get through. Out of desperation, I tried Claimyr, fully expecting it to be a scam. But within 45 minutes, I was talking to an actual IRS agent who helped me set up a payment plan and explained how to file an amended return. Saved me over $400 in penalties. I'm still shocked it actually worked. Sorry for being so dismissive before. Sometimes things that sound too good to be true actually aren't.
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QuantumQuasar
Another option nobody's mentioned is to use the free version of Cash App Taxes (formerly Credit Karma Tax). They don't charge extra for self-employment income or Schedule C. I used it last year for my Instacart gig and it worked great. Just make sure you're tracking all your miles and expenses yourself since it doesn't have fancy tracking features.
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Amara Okafor
•Do they support multiple streams of self-employment income? Like if I'm working for 3-4 different delivery apps? And does it handle state taxes too or just federal?
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QuantumQuasar
•Yes, they support multiple streams of self-employment income. You can add as many 1099s as you need, or manually enter income if you don't receive a 1099. They handle both federal and state taxes for free. The main limitation is they don't support some more complex tax situations like multi-state filing or foreign income. But for typical gig work across multiple apps, they work perfectly. Their interface isn't as polished as TurboTax, but the price difference makes it worth it.
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Zainab Omar
One important thing nobody mentioned - make sure you're setting aside money for taxes as you go! Self-employment tax is about 15.3% on top of regular income tax. When I first started delivery driving, I didn't save anything and got hit with a $2,100 tax bill I wasn't prepared for. Now I automatically put 25-30% of my gig earnings into a separate savings account.
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Connor Gallagher
•The 25-30% rule is good advice. I deliver for UberEats and found that after properly tracking mileage and other deductions, my effective tax rate was around 20%. But better to save too much than too little!
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Mason Kaczka
This is really helpful information! I'm in a similar situation as a college student looking at gig work over the summer. The mileage deduction tip is golden - I had no idea it was 65.5 cents per mile. That could really add up quickly with delivery driving. One question though - if I'm only doing this for 2-3 months like the original poster, do I still need to worry about quarterly estimated tax payments? Or is that only if you're doing gig work year-round? I'm trying to figure out if I should be setting aside money for taxes or if I can just handle it all when I file next year. Also, does anyone know if there are any good free apps for tracking mileage automatically? I feel like I'd definitely forget to log trips manually.
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