Doing taxes is still a daunting task for many, especially when not everyone has the luxury to get someone to do it. Others don’t want to have to go through third-party tax filing software to get their returns done. Thankfully the IRS is addressing this by implementing certain new programs. Here is a quick rundown of all that is new, and some tips for gig workers from a deputy commissioner at the IRS, Kevin Morehead.

The gig economy has revolutionized how individuals earn income and engage in flexible work arrangements. However, with flexibility of gig work come unique challenges, such as when filing taxes.

In a media briefing, Mar. 27, by Ethnic Media Services, Kevin Morehead shared valuable insights on how gig workers can navigate tax complexities to maximize their refunds. Here are some of the key takeaways.

What’s New

There are a multitude of changes to the way the IRS operates now. First off, in select states, taxpayers can now file directly to the IRS, using Direct File. There is also another page for state income taxes if you live in CA, MA, AZ, or NY. Others can use Free File Alliance to file on their own for free.

The IRS is also helping people with lower income and older. Volunteer Income Tax Assistance assists lower-income taxpayers with free IRS-certified counseling from volunteers. Tax Counseling for the Elderly will take care of those 60 and older.

The IRS is committed to being fair and transparent in the audit process. Morehead reassured taxpayers that audits are conducted fairly and that being called for an audit does not necessarily mean changes to their tax information. That is why accuracy is so important, to reduce the likelihood of errors that could trigger an audit.

They are also promoting effective communication channels between the IRS and taxpayers. He highlighted the user-friendly nature of the IRS website as a valuable resource for accessing information and filing taxes. They also have a toll-free help line for those who need assistance in filling out their tax forms. He also mentioned the availability of multilingual resources to cater to a diverse range of taxpayers.

Scams

As is with anything concerning one’s financials, scams are a huge problem in the tax filing process. Phone calls may be made by people impersonating an IRS agent, especially targeting new immigrants, to get their hands on their taxpayer’s money and/or personal information.

There are many tactics these scammers use, where they will attempt for the victims to wire money to them with threats of deportation or jail. They may also go as far as telling you that there is a refund due, to obtain personal information.

How do you know if it’s really the IRS? They will never e-mail, text, or ask on social media, for financial or personal information. Before any communication through phone calls, the taxpayer will be sent notices through USPS.

Gig Workers

As independent contractors, gig workers are responsible for paying self-employment taxes in addition to income taxes. To get the most out of their return they need to be diligent in keeping records of all their sources of income and expenses. This would help them maximize their deduction, reduce the amount of income that’s taxable and potentially get a higher income, all this with a simple record-keeping habit.

Gig workers are encouraged to leverage available tax deductions and credits to optimize their tax returns. Deductions for business expenses like mileage, supplies, and equipment can significantly lower taxable income. Additionally, exploring tax credits such as the Earned Income Tax Credit (EITC) can directly reduce tax liabilities and boost refund amounts.

To streamline the tax filing process, taxpayers can benefit from utilizing tax filing software or online platforms tailored for self-employed individuals. These tools offer guidance on deductions, income reporting, and tax obligations, making it easier to navigate tax complexities.

For individuals facing complex tax situations or seeking personalized guidance, consulting a tax professional or accountant, specializing in self-employment taxes is recommended. Professional advice can help with tax strategies, and identify potential deductions, while maximizing refunds, therefore ensuring the tax payer can make informed decisions.

Filling out your taxes can definitely be stressful, but the IRS is there to help you along the process. From help lines to financial programs, there are a multitude of ways you can get the assistance you need.

Gig workers and business owners stand to benefit heavily from a comprehensive record-keeping system, helping them make the most of their tax returns. Software exists to make your life easier, but the IRS now also allows you to file directly. There are quite a few ways you can go about filing your taxes with plenty of help available. The greatest resource available to the taxpayers is the IRS website itself.

More information at irs.gov.