• New Reporting Threshold: A new threshold has been introduced for 2023. If you've earned a minimum of $600 across any number of transactions by the time you file your taxes, you'll receive a 1099-K. This underscores the importance of diligently monitoring your Thumbtack revenue, regardless of its magnitude.

Recent IRS Update: 1099 Reporting Guidelines

While discussions about potential changes in 1099-K reporting guidelines were ongoing, the IRS has confirmed that the reporting threshold will remain at $20,000 for 2023. The proposed reduction to $600 has been postponed until the 2024 tax year. Keeping abreast of these changes is essential for effective management of your Thumbtack taxes.

Understanding Thumbtack Taxes

Before delving into specifics, it's crucial to comprehend the concept of Thumbtack taxes. The platform serves as a marketplace for service providers to connect with clients and earn income, leading to tax responsibilities for those generating revenue through the platform.

Who Needs to Pay Thumbtack Taxes?

Service providers earning income through Thumbtack are responsible for Thumbtack taxes. With the updated threshold, anyone earning a minimum of $600 across any number of transactions is required to receive a 1099-K. This broader scope emphasizes the importance of diligently monitoring earnings.

How Will Thumbtack Deliver Your 1099s?

Once you reach the $600 earnings threshold on Thumbtack, the platform will send a 1099-K form. Typically, these forms are sent electronically through your Thumbtack account. Ensuring your contact and tax information are up-to-date is crucial for receiving your 1099-K promptly.

Which Tax Forms Are Necessary?

• 1099-K: This form outlines your gross revenue from Thumbtack transactions.
• 1099-MISC: Additional income, such as bonuses, may be reported on this form.
• Schedule C: If you operate as an independent contractor or business on Thumbtack, filing Schedule C is essential to report self-employment income and deductions.

How Can You Minimize Thumbtack Taxes?

• Deductions: Identify eligible business expenses related to your Thumbtack activities, such as equipment, travel, and necessary supplies. This helps reduce your taxable income.
• Quarterly Payments: For substantial Thumbtack revenue, consider making anticipated tax payments quarterly to avoid penalties at year-end.
• Retirement Contributions: Contribute to a retirement account to reduce your taxable income.
• Tax Credits: Explore potential credits to minimize your overall tax obligation.

What Write-Offs Can You Claim for Thumbtack?

• Business Expenses: Deduct the cost of any necessary business-related expenses, including equipment, travel, and necessary supplies.
• Home Office Expenses: If you use a dedicated space for Thumbtack work, you may be eligible to claim home office expenses.

When Do You File Your Thumbtack 1099 Taxes?

• January 31: Thumbtack typically sends 1099-K forms by this date. Ensure your contact information on your Thumbtack account is accurate for swift receipt.
• April 15: File all income reported on the 1099-K by this date on your federal income tax return.

How Can FlyFin Support Your Thumbtack Taxes?

• Tax Preparation: Ensure accurate filing of your tax return, including Thumbtack 1099 taxes, with FlyFin's expert CPA team. Comprehensive audit insurance is also included.
• Tax Planning: Receive guidance on tax planning, including precise self-employment tax calculations and individual tax planning sessions aimed at minimizing your taxes.
• Expert Guidance: Address all your tax-related queries with FlyFin's tax professionals and receive advice on optimizing credits and deductions.

What’s FlyFin?

FlyFin caters to the tax needs of freelancers, gig workers, independent contractors and sole proprietors. But anyone can file taxes through FlyFin! FlyFin tracks all your business expenses automatically using A.I. technology. Then, our CPA team files a guaranteed 100% accurate tax return for you – to save you a couple thousand dollars and a ton of time on your taxes. In addition, you can download the FlyFin app and have your taxes filed in less than fifteen minutes, saving time and money.