SHARING ECONOMY TAX IDEAS
July 23, 2020 - Douglas Myser
Sharing economy tax ideas. So you have a house to rent---or maybe just a room, in the sharing economy. Or perhaps you'd like to pick up passengers in your car working for Uber or Lyft. Pursuing these types of business activities can be great sources of additional income. But there are drawbacks too, including those involving taxes for the shared economy. There are several trickly tax rules to beware, especially if you want to lease your home or part of it: A guide prepared for Airbrib landlords by accounting firm Ernst and Yound runs 28 pages. yet plenty of the more than 2.5 million people now estimated to be part of the "shared economy" aren't familiar with the rules, especially when they involve renting out part of a home. Sharing economy tax ideas.
"Many individuals might take on these new jobs completely unaware (of the tax obligations), " said Nina Olson, the National taxpayer Advocate, in Congressional Testimony last year. The rules can be more confusing for people such as part time, secondary sources of income, she said. In a poll conducted by the National Association of the Self-Employed, roughly one-third of survey participants didn't realize they might need to file quarterly estimated payments, and roughly one third didn't know what types of tax records to maintain. Yet more people are engaging in the sharing economy. In one recent example, Airbrib said the nearly 4,700 Phoenix area residents who opened their homes to Spring Training guests this year and used the company's services earned $2350 on average over the six week exhibition baseball season. Sharing economy tax ideas.
The money you earn from the sharing economy pursuits typically is taxable and must be reported, even if you're running things as a part time or sideline business. Income also is taxable, even if you collect the proceeds in cash and don't receive any IRS Form 1099's. One exception involves income from renting your personal residence for fewer than 15 days each year--that money isn't taxable. While the income usually is taxable, you similarly may qualify for various deductions to lower the tax bite. The list of deductible expenses can include mortgage interest, property taxes, utilities, repairs, insurance and advertising.
If you didn't keep your expenses and have a large tax debt, or have unfiled returns and no expenses, call us as we can help you. We are a Nationwide Tax Resolution Company that is respected among other National Tax Resolution Companies. Our process makes Tax Resolution a stress free undertaking for our clients. We can file all past due returns, then determine options for both IRS and State Revenue Departments tax debts for Tax Relief options, including the IRS Fresh Start Program and options not in that program. We can work on your IRS Wage Garnishment or Bank Levy, if you have one. Call today for a Tax Resolution Services consultation. 1-888-689-7861