Can someone explain to me like I'm a child the difference between a hobby and 'self-employed contractor income'.
I second shoot weddings for another person. I don't have a business. It's not my means of income, nor is it related in anyway to my primary job. I make money from it, yes, but I don't go out and try to make money off it, either. It's something I enjoy doing. I was told this is a hobby and not self-employment (aka, no self employment tax) and to put it under the 'other income' section. If it helps, I'm pretty sure my expenses pretty much negate any money I was given.
Can someone explain to me like I'm a child the difference between a hobby and 'self-employed contractor income'.
I second shoot weddings for another person. I don't have a business. It's not my means of income, nor is it related in anyway to my primary job. I make money from it, yes, but I don't go out and try to make money off it, either. It's something I enjoy doing. I was told this is a hobby and not self-employment (aka, no self employment tax) and to put it under the 'other income' section. If it helps, I'm pretty sure my expenses pretty much negate any money I was given.
You need to fill out a schedule C or C-EZ. Input your income there and you can also deduct your expenses. As long as your expenses truly negate the income you will not have to pay SE tax. If you do have a net income you will need to pay the SE tax. You are self employed as a photographer.
My DH bought 4 Nintendo Switches for $300 and sold for $400 on ebay via paypal. So he 'made' $400. We received a 1099-k from Paypal.
Please tell me that I don't have to file a Schedule C. I'd also prefer not to go to an accountant since that $400 profit is ending up costing us more than it was worth and excepting this we could file for free. We have no problem paying tax on it though.
I've done some reading and think we can classify this as Hobby income. Anyone done this before?
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ETA2: TaxAct will allow me to do Schedule C for an extra fee, Credit Karma will do it for free. And luckily DH kept really good spreadsheets on the sale of the Switches and the couple of other things that he sold so it only took a couple of hours to wrangle.
“With sorrow—for this Court, but more, for the many millions of American women who have today lost a fundamental constitutional protection—we dissent,”
1. I put all of our itemized stuff into turbo tax and the standard deduction is still the better option. We have 3 kids, a mortgage, some low student loans, and are able to claim medical expenses. Does this sound right? I was just surprised. If it matters our income is about $60,000. Our current estimated refund is $4,600 total, but I'm still waiting on a $5,500 w2 which will probably lower it.
2. We stand to have the same income for next year and are having another baby in June. Should I have my husband add an extra withholding to his primary job?
Thank you for your patience! I know these are basic questions that I should probably know the answer to.
Student loans are deducted below the line, which means they aren't part of your itemized deductions. Depending on how much interest plus property taxes plus state income tax, it's possible the standard deduction might be better for you.
Yes, all of this. The student loans are irrelevant to the deduction question. For 2017, the MFJ (Married Filing Jointly) Standard Deduction is $12,700. So the question is, do your mortgage interest, property taxes, and charitable giving add up to more than $12,700? There are a few other schedule A things as well, so if you think you may be close, this is worth a second look. That said, despite my mother insisting that "Turbo Tax did it WRONG in 2011 so I don't trust computers", lol, I tend to find that Turbo Tax is always right.
As for the baby -- congrats! If you're getting a $4600 refund this year on a $60k salary, I personally wouldn't have more withheld. Wait, are you asking about increasing his number of exemptions so that less is withheld? Honestly, with your refund amount compared to your salary, I would look at having less withheld whether or not you had #4 on the way.
Is anyone handling their own returns without an accountant or software? We planned on doing it since TurboTax was expensive last year. I printed our '16 returns and w/state it was 150 pages. Will it take forever to do ourselves??
Is anyone handling their own returns without an accountant or software? We planned on doing it since TurboTax was expensive last year. I printed our '16 returns and w/state it was 150 pages. Will it take forever to do ourselves??
Credit Karma is completely free (at least for us with Itemized, a Schedule C and a State Return). I switched this year since TaxAct was also charging me about $80.
I have done it by hand. And it did take a really long time. It was pretty complicated that year, and was my first year doing it at all. It was a great learning experience, but I don't think I'd do it again if I could prevent it. I was unemployed at the time which helped.
I've done our State ones before because it's free to efile on the state's .gov site and the software was charging $25. That was easy. I actually did it in the software to get the amount (right up to where they were going to charge), and then did it on the state website and made sure I got the same.
“With sorrow—for this Court, but more, for the many millions of American women who have today lost a fundamental constitutional protection—we dissent,”
How reputable is Credit Karma Tax and how/why aren’t they charging for returns? I usually use TT Deluxe for about $27 but I need a schedule C for a 1099 this year and I think TT charges extra. Just weighing my options.
They've been around for a couple of years. You can only do 1 state return, the support isn't as good as TT - I still search their forums for answers. It doesn't have comprehensive coverage, so for complicated stuff it may not be a good fit. I heard there's an issue with the Child Tax Credit this year.
Having said that, I ran in Tax Act, TurboTax and CK and got the same in them all, so I'm comfortable with it.
It's free because of advertising and to try get people to sign up for the credit tracking. But I have a credit karma account anyway to monitor my credit, so it was an easy decision for me.
“With sorrow—for this Court, but more, for the many millions of American women who have today lost a fundamental constitutional protection—we dissent,”
Is anyone handling their own returns without an accountant or software? We planned on doing it since TurboTax was expensive last year. I printed our '16 returns and w/state it was 150 pages. Will it take forever to do ourselves??
150 pages? Is that because of formatting in the program? What form and how many schedules do you file? I do mine by hand because I don't want to pay for anything (and the one time I used Turbo Tax it missed something) and it's fine. But I don't have anywhere near that many pages!
Is anyone handling their own returns without an accountant or software? We planned on doing it since TurboTax was expensive last year. I printed our '16 returns and w/state it was 150 pages. Will it take forever to do ourselves??
150 pages? Is that because of formatting in the program? What form and how many schedules do you file? I do mine by hand because I don't want to pay for anything (and the one time I used Turbo Tax it missed something) and it's fine. But I don't have anywhere near that many pages!
it seemed like a lot of work sheets. We’re pretty typical dual income professionals with kids in daycare. Some dividends and stock losses but nothing else particularly special. I think we’re going to just pay one of the big companies.
Certain tax provisions expired at the end of 2016. Your entries indicate that you are trying to claim one of these expired provisions. At the time this program was released, legislation was pending to extend these tax provisions into 2017. A program update will be released if the pending legislation becomes law. Schedule A - Itemized Deductions, Qualified Mortgage Insurance Premiums Deduction
Would you wait to file to see if this goes through? What's the likelihood of it happening?
Certain tax provisions expired at the end of 2016. Your entries indicate that you are trying to claim one of these expired provisions. At the time this program was released, legislation was pending to extend these tax provisions into 2017. A program update will be released if the pending legislation becomes law. Schedule A - Itemized Deductions, Qualified Mortgage Insurance Premiums Deduction
Would you wait to file to see if this goes through? What's the likelihood of it happening?
I got an email this morning (I'm a CPA but don't really specialize in taxes so don't ask me much else!), that this was extended, so the deductions will be good if you wait.
The software at our firm isn't expected to be updated until next month.
Certain tax provisions expired at the end of 2016. Your entries indicate that you are trying to claim one of these expired provisions. At the time this program was released, legislation was pending to extend these tax provisions into 2017. A program update will be released if the pending legislation becomes law. Schedule A - Itemized Deductions, Qualified Mortgage Insurance Premiums Deduction
Would you wait to file to see if this goes through? What's the likelihood of it happening?
I got an email this morning (I'm a CPA but don't really specialize in taxes so don't ask me much else!), that this was extended, so the deductions will be good if you wait.
The software at our firm isn't expected to be updated until next month.
Awesome, thanks! I'm in no hurry. I'm in accounting too, but we're not for profit, so don't worry about tax laws really, lol!