I was paid as a caregiver via Zelle - how do I report this on my taxes and what percentage will I owe?

14 You're considered self-employed as a caregiver paid directly by a family. Since you received payments through Zelle without any tax withholding, you'll need to report this as self-employment income on Schedule C of your tax return. You'll owe self-employment tax (15.3% for Social Security and Medicare) plus your regular income tax based on your tax bracket. The self-employment tax applies to your net profit after deducting any legitimate business expenses related to your caregiving work. Keep records of all payments received and any expenses directly related to your work (transportation between clients, supplies you purchased, etc.). The family doesn't need to provide you a 1099 if they're paying you as a household employee, but they should be handling it differently if they're claiming you on their taxes for a dependent care credit.

19 I was in a similar situation last year and discovered taxr.ai (https://taxr.ai) which helped me figure out my self-employment tax situation. I was freaking out about how to classify my caregiver income since I was also getting paid through Venmo without any tax forms. The system analyzed my situation and walked me through exactly what forms I needed to file and how to calculate my estimated tax payments. The best part was it showed me what expenses I could legitimately deduct that I had no idea about - like mileage driving to and from my client's home, portion of my cell phone bill used for work, and special clothing/supplies I bought specifically for caregiving. Ended up saving me a ton on my tax bill!

8 Just wanted to update everyone - I tried taxr.ai after seeing it mentioned here and it was seriously helpful for my caregiver tax situation. I uploaded screenshots of my Zelle payments and it helped classify everything correctly. The best part was it showed me that I qualified for some self-employed health insurance deductions I had no idea about! The tool clarified that since I set my own hours and use my own supplies, I'm definitely self-employed rather than a household employee. It even generated a letter I could give to the family explaining their tax responsibilities versus mine. Definitely worth checking out if you're confused about caregiver income reporting like I was!

6 If you're having trouble figuring out your tax situation, you might want to try calling the IRS directly. I discovered a service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in less than 15 minutes after I'd been trying for days. They have a video showing how it works here: https://youtu.be/_kiP6q8DX5c I needed clarification about my caregiver income that I received through payment apps, and the IRS agent walked me through exactly how to report it correctly. They confirmed I needed Schedule C and explained the household employee vs. independent contractor rules - saved me from potentially filing incorrectly. Before using Claimyr, I was stuck on hold for hours and kept getting disconnected.

11 I need to apologize for my skepticism. After waiting on hold with the IRS for over 2 hours yesterday and getting disconnected TWICE, I tried Claimyr out of desperation. Within 20 minutes I was actually talking to an IRS representative who clarified my caregiver tax situation. The agent confirmed I should be using Schedule C since I work for multiple families and set my own schedule. She also explained I could deduct mileage between clients (but not from home to first client or last client to home). Honestly shocked this service actually worked - saved me an entire day of frustration. Wish I'd known about it sooner!

18 Don't forget to check if you need to pay quarterly estimated taxes! I got hit with penalties my first year as a caregiver because I didn't realize I needed to make payments throughout the year. Generally if you expect to owe $1,000 or more at tax time, you should be making quarterly payments.

3 Something nobody's mentioned yet - keep a mileage log if you drive as part of your caregiving duties! I deducted over $2,000 last year just from tracking my mileage driving my client to doctor appointments and running errands for them. The IRS mileage rate for 2025 is 65.5 cents per mile.

One important thing to consider is whether you should be classified as a household employee versus self-employed. Since the family is claiming you on their taxes for a dependent care credit, they might actually be required to treat you as a household employee and handle payroll taxes. If you're a household employee, they should be withholding and paying Social Security and Medicare taxes on your behalf. However, if you control how and when you work (set your own schedule, use your own supplies, etc.), you're likely self-employed. For $15,300 in annual income, you'll definitely want to make quarterly estimated tax payments to avoid penalties. I'd recommend setting aside at least 25-30% of each payment to cover both self-employment tax and income tax. Don't forget you can deduct legitimate business expenses like mileage, supplies, and any training related to caregiving. You should also check if the family needs to provide you with any tax documents - they may need to give you information for their dependent care credit claim even if they don't issue a 1099.