With the gig economy growing rapidly, freelancers and independent contractors are replacing full-time employees with temporary, flexible jobs with businesses. The global gig economy’s estimated worth in 2021 was 347 billion dollars, and it is expected to grow to 455 billion dollars by 2023. However, gig workers face unique financial challenges, including being underbanked and lacking access to resources that can grow their financial wellness.
Health Insurance Challenges for Gig Workers
A study by Legal & General Group found that nearly half of U.S. gig workers struggle to access health insurance. The lack of a social safety net causes stress and frustration for gig workers, leading to calls for companies to address the issue and develop solutions. Health care coverage is considered a given in most wealthy, industrialized nations, but freelance work negatively impacts the ability to find health insurance.
Tax Tips and Strategies for Self-Employed Individuals
FlyFin, an AI-powered platform, introduces tax tips and strategies for self-employed individuals to save on taxes. The new resources cover ways to reduce taxable income and lower the amount of tax owed. The resources include strategies for responsibly paying taxes and highlighting potential penalties and deductible expenses. The American Rescue Plan Act of 2021 resulted in a new IRS rule requiring a $600 threshold on payment apps such as Venmo, Zelle, Cash App, etc. Freelancers and gig workers will be required to report any payments of $600 or more made through payment apps as income on their tax returns.
Reporting Requirements and Penalties
Small business owners will be required to issue Form 1099-K for payments of $600 or more made through payment apps and file it with the IRS by January 31 of the following year. Freelancers and gig workers will be required to pay self-employment taxes on any payments of $600 or more made through payment apps. Small business owners may be penalized for failing to issue Form 1099-K for payments of $600 or more made through payment apps.
FlyFin’s Tax Resource Center
FlyFin’s goal is to give customers all the knowledge and tools they need to make informed decisions about their taxes. FlyFin has a comprehensive Tax Resource Center that helps freelancers and self-employed individuals prepare and file their taxes. The Tax Resource Center offers free tools, calculators, guides, tax forms, and more. FlyFin is an AI-powered platform that provides self-employed individuals with a convenient, easy-to-use, and affordable tax filing solution.
