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Natasha Orlova

Is there a simple way to do taxes for gig work and mileage deductions?

I'm getting so frustrated trying to figure out my taxes this year. I've got income from two different sources and I'm completely lost. I've got about $14k from my regular job where taxes are already being withheld. Then I made around $23k from gig work (Uber/DoorDash/etc). I've been keeping track of my miles and drove approximately 15,600 miles for the gig work. If I multiply that by $0.65 per mile, that gives me about $10,140 as a deduction. I'm totally confused about how to report this. Do I just put the 1099 income on line 2a? Do I need to include my W-2 job income since taxes are already taken out of that? Should I just put $23k - $10k deduction = $13k as my taxable gig income on the 1099? Also, I'm scared about making mistakes. I've spent so many hours trying to understand this stuff and my situation is pretty straightforward! If I mess up, will the IRS just take money directly from my bank account? I tried calling them but got stuck in an endless loop of button pressing only to be told no one would answer my question 😤

Javier Cruz

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You're mixing up a few things, but don't worry - it's actually simpler than you think! First, your W-2 income ($14k) and your gig work (1099) income ($23k) are reported separately on your tax return. The W-2 income goes on one part of your Form 1040, and your gig income goes on Schedule C. For your gig work: Yes, you can deduct your business mileage! On Schedule C, you'll report your total gig income of $23k, then deduct your business expenses including the $10,140 for mileage. This gives you your net profit from self-employment, which then gets reported on your 1040. The IRS doesn't automatically take money from your bank account if you make a mistake. If they find an error, they'll typically send you a letter explaining the issue and what you owe. You'll have time to respond or pay. Would you be comfortable using tax software? Something like FreeTaxUSA or TaxSlayer can walk you through this step by step and is much easier than trying to figure out the forms yourself.

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Thanks for explaining! I've heard of Schedule C but wasn't sure if that applied to me. So I report ALL my gig income on Schedule C, then subtract my mileage deduction there? What about self-employment tax? Is that calculated automatically when I fill out Schedule C?

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Javier Cruz

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Yes, you report all your gig income on Schedule C and subtract all your business expenses there, including your mileage deduction. This gives you your net profit from self-employment. Self-employment tax is calculated on Schedule SE, which is based on your net profit from Schedule C. Most tax software will automatically calculate this for you once you enter your Schedule C information. The self-employment tax is roughly 15.3% of your net profit (covers both Social Security and Medicare taxes that would normally be split between you and an employer).

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Emma Thompson

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After struggling with similar gig work tax issues last year, I finally tried taxr.ai (https://taxr.ai) and it made everything so much easier! I uploaded my 1099s and it automatically identified all potential deductions I could claim, including mileage. The best part is it walks you through exactly how to fill out Schedule C and SE forms with step-by-step guidance. I was confused about separating my W-2 income from my gig work too, and it explained everything in super simple terms. It even showed me which specific lines to put everything on and calculated my self-employment tax automatically.

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Malik Jackson

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Does it actually check if your deductions are reasonable? I've heard horror stories about people claiming too many miles and getting audited. Would this help prevent that?

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I'm a bit skeptical about these tax tools. Does it actually save you money compared to just using something like TurboTax? And how does it handle state taxes for gig work if you work across different states?

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Emma Thompson

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It actually does check if your deductions fall within reasonable ranges based on your industry and income level. It flagged that my mileage seemed a bit high for my income and suggested I double-check my records to make sure I could substantiate the claim if audited. Super helpful for avoiding red flags! Compared to TurboTax, it saved me around $300 because it found deductions I didn't know I qualified for. As for multiple states, it handles that really well - I drove for Uber in three different states, and it helped me allocate the income correctly on each state return.

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Malik Jackson

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I was super skeptical about taxr.ai at first, but after struggling with my gig work taxes for hours, I gave it a try. Total game changer! It actually showed me that I was calculating my mileage deduction wrong AND missing several other deductions for my DoorDash work. The interface walked me through reporting both my W-2 job and gig work income, showed exactly where to put everything, and calculated my self-employment tax automatically. It even explained the quarterly estimated tax payments I need to make this year to avoid penalties. For anyone confused about gig work taxes like I was - seriously worth checking out. Ended up getting about $800 more on my refund than I would have filing on my own because I was missing so many legitimate deductions!

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StarSurfer

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If you're still having trouble and want to speak directly with the IRS, try Claimyr (https://claimyr.com). I was stuck in the same endless phone loop hell trying to sort out my gig work tax questions, then found this service that gets you through to an actual human at the IRS usually within 15 minutes. Check out their demo: https://youtu.be/_kiP6q8DX5c I used it when I was confused about how to handle my mileage deduction and whether I needed to amend my previous year's return. Instead of waiting on hold for hours or never getting through, I was speaking with an IRS agent who answered all my questions in about 15 minutes.

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Ravi Malhotra

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Wait, how does this even work? The IRS phone system is notorious for being impossible. How can a third party service possibly get you through faster?

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This sounds too good to be true. I've spent HOURS trying to get through to the IRS and eventually gave up. If this actually works, why doesn't everyone use it? There must be a catch.

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StarSurfer

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They use a combination of automated technology and algorithms to navigate the IRS phone system efficiently. It's basically a service that handles the waiting and navigating the phone tree for you, then connects you once a human agent is available. There's no magic trick - they're just specialized in navigating the IRS phone system. Think of it like having someone wait in line for you. Most people don't know about it yet because it's relatively new, but it's been growing quickly through word of mouth from people who've used it successfully.

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Ok I have to eat my words about Claimyr. After my skeptical comment I decided to try it because I was desperate to fix an issue with my gig work taxes from last year. I was 100% sure it wouldn't work or would be a waste of money. I was SHOCKED when I was talking to an actual IRS agent in about 12 minutes after trying for literally weeks to get through on my own. The agent walked me through exactly how to report my gig income, how to handle the mileage deduction, and confirmed that I needed to file Schedule C and SE forms. They even helped me understand how much I should be setting aside for quarterly estimated taxes this year (about 25-30% of my gig income after deductions). Honestly the best money I've spent in a long time considering how much stress it saved me.

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Another option: Consider using a tax professional who specializes in gig workers. I paid about $200 to an accountant who specifically works with Uber/Lyft/DoorDash folks, and she saved me WAY more than that in deductions I didn't know I could take. Besides mileage, did you know you can potentially deduct a portion of your phone bill? Car insurance? Even snacks/water if you provide them to passengers? The right professional can walk you through all of this.

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Omar Hassan

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What's the best way to find a tax pro who actually knows gig work? I tried H&R Block last year and the person had no clue about rideshare deductions.

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Look for independent tax preparers who specifically mention gig economy or rideshare experience in their marketing. I found mine through a local Facebook group for Uber/Lyft drivers in my city. You can also check the National Association of Tax Professionals website and search for someone with "gig economy" or "self-employment" specialization. Avoid the big chain tax prep places for gig work - their training is often too general. You want someone who regularly works with drivers and delivery people specifically. Ask potential preparers how many gig workers they serve and what typical deductions they help clients claim.

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Quick tip: Download the Stride app to track your mileage automatically. I drive for multiple apps and it's been a lifesaver. Just hit "start work" when you begin and "end work" when you're done. At tax time, it gives you a report with all your business miles and the deduction amount.

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Diego Chavez

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Does it drain your battery? I tried another mileage app and it killed my phone within a few hours.

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I haven't noticed any significant battery drain. It uses your phone's GPS but seems pretty efficient about it. I can usually go a full 8-hour shift with about 25-30% battery use from the app. Much better than the other ones I tried before. I keep my phone plugged in while driving anyway, so it's never been an issue. The accuracy is really good too - it doesn't count small movements when I'm parked waiting for orders.

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I totally understand the frustration! I went through the same confusion with my gig work taxes last year. Here's what I learned that might help: Your W-2 income and 1099 gig work are reported separately - don't try to combine them. The W-2 goes on the main 1040 form, and your gig income goes on Schedule C where you can deduct your business expenses. For your mileage, you're on the right track! You can deduct either actual vehicle expenses OR the standard mileage rate (currently $0.655 per mile for 2023). Since you tracked 15,600 miles, that's about $10,218 in deductions, which is substantial. Don't stress too much about making mistakes - the IRS typically sends letters first if there are issues, not immediate bank account seizures. They actually want to help you get it right. One thing that saved me: keep detailed records of everything. Besides mileage, you might be able to deduct things like phone bills (business portion), car washes, parking fees, and even some supplies. The key is having documentation. Have you considered using tax software specifically designed for gig workers? It can walk you through Schedule C step-by-step and make sure you don't miss any deductions. Much less stressful than trying to figure out the forms manually!

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Ravi Sharma

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This is really helpful, Jessica! I'm curious about the phone bill deduction you mentioned. How do you calculate the "business portion" of your phone bill? Is it based on the percentage of time you're actively driving for gig work, or do you use some other method? Also, when you say "supplies," what kinds of things qualify? I keep napkins and phone chargers in my car for gig work - would those count as deductible business expenses?

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