(gentle electronic music)
- Hey everybody, this is Roberto Blake
helping you create something awesome today.
Welcome back to the channel.
Today we are going to be talking about
freelancing, taxes and 1099s.
This is something that's really important because
a lot of you who are freelancers during tax time,
you're confused, you don't know what to do,
and this happens to a lot of self employed people.
It's why we've covered this is
in other videos on the channel.
I'm going to link to those up here.
The good news is I have some tips
that can ultimately help you with your taxes,
what your deductions are and what
you can expect as a freelancer.
So this video is brought to you by
my friends over at TurboTax.
Taxes are complicated and it's nice to have
some advice and tips from professionals who are qualified,
and that's part of why I wanted to partner with TurboTax
for this video so we could give you guys
some advice as freelancers for handling your taxes.
Check out TurboTax Self-Employed.
I'm going to link to that in the
description down below for you guys.
I highly recommend that you use it
for your filing this year.
So if you're a freelancer, will you get a 1099 form?
This is a very popular question.
At tax time you get a lot of different forms,
and if you are a freelancer or an independent contractor,
a 1099 is typically one of them.
If you are working a traditional 9-to-5 job
you usually would get a W-2 but
freelancers are going to get a 1099.
You also get a 1099 if you're a YouTube content creator
or if you're doing online business, affiliate marketing,
there are a lot of these places that
ultimately will give you a 1099 form.
The IRS differentiates regular wage-based income
from income that you earn independently,
and that's why we're going to get
1099 forms versus W-2 forms.
Now the person who paid you in terms of either
the platform or the person who contracted your services,
they are responsible for getting you this 1099 form,
if you made over $600 U.S.
If you made less than $600 typically you won't see a 1099,
however you are still responsible for
reporting that income to the IRS.
Sometimes people have questions about the
1099-Miscellaneous versus a 1099-K.
And I completely understand because I was
confused by this as well when I started
making a lot more money independently.
Now typically freelancers and consultants
who make over $600 get a 1099-Miscellaneous,
but if you're using a payment process
or you're working through a company
then you might get a 1099-K.
And typically this happens when you have
payment processing like I do with say PayPal
that might be over a certain amount of money.
Typically around maybe $20,000 or maybe
if you're working for a ride-share company
and you're working through some other type of agency
you might get a 1099-K as a contractor.
It just really depends on the situation.
Some of these situations include whether
you made over $20,000 in transactions or whether
you did over 200 individual transactions.
This is why people working within the gig economy
will often see a 1099-K versus a 1099-Miscellaneous.
These are just kind of situations that
kind of differentiate those.
Now believe it or not there are other types of 1099 forms
besides your 1099-Miscellaneous and your 1099-K.
There are different types of 1099 forms
that all have to do with different types of income.
One of the examples is a 1099-INT.
A 1099-INT is for interest based income.
So this might come from a financial institution.
One of the examples would be for example,
I use an investment app called Acorns.
A 1099-INT might also come from your bank
or a financial institution where you're getting
interest on an account that you have.
For those of you that have loans,
let's say maybe you have a student loan,
if you get some kind of debt forgiveness
that might actually be counted as income,
and you'll get a 1099-C if that's the case.
For income that comes from real estate transactions
you'll actually get something called a 1099-S,
and this is for that real estate transactions income,
and you can see how these different variety of 1099 forms
play out and how for their different income sources.
When you receive a 1099-Miscellaneous and you're
reporting your income to the IRS you can actually
claim deductions against that on what's called a Schedule C.
Once you do that you can use it to do the calculations
for your self-employment income.
I know this is complicated but here's the good news.
If you use TurboTax Self-Employed they'll ask you
a series of very simple to answer questions
that will help you get the appropriate deductions.
So without you having to know about
all these complicated tax forms,
TurboTax Self-Employed is going to get you
your industry specific deductions and savings,
and it's going to take care of you.
One of the last things you wanna do when you're freelancing
is spend more time than you need to stressing out
and worrying about your taxes and your tax situation.
I also recommend that to help you keep track of
your expenses that you consider getting QuickBooks
to help you with your business expenses.
You can also use it to invoice your clients,
and for your personal expenses I'm going to recommend
the Mint app and these are all from Intuit.
I hope this helped answer some of your questions
about freelancing and 1099s and this is something
that I think is very important for people who are
freelancers, consultants or running their own
kind of self-employed business,
and that is why I wanted to cover this
and I am so grateful that our friends at TurboTax
help me answer some of these questions for you guys.
I'm going to link to some more resources,
articles and things that I think
will be helpful in the description down below,
as well as a link that you can use to go ahead
and start filing with TurboTax Self-Employed.
Question of the day: What is the biggest stress factor
in your freelancing business?
In your career as a freelancer or someone
who is self-employed, what is the
biggest overall stress factor that you deal with?
I want to make some videos about this
so leave that in the comments section.
Like this video if you liked it. Don't forget to subscribe.
Check out the other awesome stuff here on the channel.
Remember we've got some videos on more tax tips for you
linked up here and in the description below.
As always you guys, thanks so very much for watching,
and don't forget, go out there
and create something awesome today.
Take care.