The World's first A.I. tax engine for freelancers.

Document If you are driving for Instacart (full-time or part-time), you must keep a portion of your income aside for tax. Paying estimated taxes quarterly is the best way to avoid tax penalties and prepare yourself in advance for the tax season. You can also pay annually if you earn a small income from delivery. In this post, we have discussed Instacart and taxes . Read on to learn about your tax obligations from this self-employment income. Instacart and Taxes: What Taxes Instacart Workers Pay? Unless you are an in-store shopper, you are considered an independent contractor who’s supposed to file your income tax returns manually. Your income isn’t withheld automatically, leaving you with only one option — paying your taxes annually or quarterly by calculating the dues. Commonly known as FICA taxes, freelancers and business owners have to pay a fixed percentage of Social Security and Medicare taxes yearly, given that their income exceeds the $60

Document Paying income tax can seem overwhelming for American taxpayers, as there are dozens of forms, and each consists of several sections. Most people use tax filing software or work with tax accountants to simplify the filing part. But, before we get there, you need to understand various IRS tax forms that taxpayers with a certain income or specific sources of income are liable to submit. Let’s check out the 2022 tax forms . Form 1040 and Form 1040-EZ The standard two-page long tax return form consists of the details about your filing status, income, and dependents. You don’t necessarily need a job to be liable to fill out Form 1040. Even those without a source of income can file this form if they are eligible for tax credits and refunds.  This is a complicated version of Form 1040-EZ (for senior citizens), but it allows you greater flexibility and many deductions. You can itemize deductions and save more on your taxes. Form 1040-EZ is for 6

 The forms in the Internal Revenue Services’ 1099 series help taxpayers declare all the payments they receive in one calendar year from sources that are not a paycheck. Consequently, one variant of 1099 is the IRS 1099-K form , which helps independent sellers report income from ‘payment card and third party transactions.’ Unfortunately, many people, especially those who sell items on eBay as a hobby or side hustle, are not too familiar with the 1099-K; thus, they get in trouble and have to pay penalties and dues to the IRS. ARE YOU ELIGIBLE TO RECEIVE 1099-K? On March 11, 2021, the IRS changed the tax laws, and the threshold for receiving Form 1099-K from various selling platforms was lowered. So, do not be surprised if you see a mail with Form 1099-K in the 2023 tax season. If in 2022, you received any payments from payment card transactions (Credit or debit cards) or in settlements of third-party network transactions (PayPal, Venmo, etc.) that exceeds USD 600 will receive the IRS 109

It is always best to expect the ‘unexpected’ when filing tax returns. However, even if you have the most benign intentions, things may not go as planned, and you might face tax penalties for underestimating the quarterly payments, missing a deadline, bouncing off a check to the IRS, and much more. Therefore, with the upcoming tax season approaching, it is best to equip oneself with all the nitty-gritty of tax penalties and understand how tools like a  tax penalty calculator   can help. WHAT ARE THE COMMON TAX PENALTIES?  Some of the common penalties that the IRS charges are – Failure to File – It is applicable when you do not file your taxes on time. Here, the tax penalty is 5 percent of the unpaid tax for each month or part of a month wherein your return is late. However, the fine caps at 25 percent of your balance.   Information Return – Expect penalties if you do not accurately furnish the necessary information return or payee statement within the stipulated timeframe.   Failure to