Something nobody's mentioned yet - if you're making under 12k but over 400 bucks, you probably won't owe income tax, but you WILL owe self-employment tax (which is basically Social Security and Medicare). That's about 15.3% of your net profit. So if you made $2,800 but had $800 in expenses, your net profit would be $2,000, and you'd owe about $306 in self-employment tax. Don't be caught off guard by this! A lot of new freelancers don't budget for it and get surprised at tax time.

Unfortunately, there's no way to reduce the self-employment tax rate itself - it's a flat 15.3% on your net self-employment income. However, you can reduce what you pay it on by maximizing your business deductions. The reason self-employment tax kicks in at just $400 while regular income tax has higher thresholds is that self-employment tax is specifically for Social Security and Medicare contributions. When you're an employee, your employer pays half of these taxes for you, but when you're self-employed, you pay both the employee and employer portions. The good news is that you can deduct half of your self-employment tax when calculating your income tax, and you're building credits toward your future Social Security and Medicare benefits. It might seem unfair now, but you're essentially paying into your own retirement and healthcare system. Also, if you're making quarterly estimated tax payments (which you should be if you expect to owe more than $1,000), you can spread this cost out over the year instead of getting hit with one big bill at tax time.

One thing to watch out for with Cash App - if you deposit over $10,000 in cash within a short period, your bank might file a Currency Transaction Report. This isn't a tax issue but a regulatory thing for preventing money laundering. It doesn't mean you're in trouble, but if you're regularly depositing large amounts of cash, it might trigger some questions.

I had a similar situation with my elderly grandmother who doesn't trust banks but needed digital payments for some services. What helped me was keeping detailed records of all the cash I converted to Cash App funds - like taking photos of the bills before depositing and noting the amounts and dates. Even though it's not technically required for personal transfers, having that documentation gave me peace of mind in case anyone ever questioned where the money came from. I also made sure to never mark any of these transfers as "goods and services" in the app - always kept them as personal transfers or gifts. The $2500 you mentioned is well under any concerning thresholds, but good record-keeping never hurts. I use a simple spreadsheet with dates, amounts, and notes like "converted grandmother's grocery money to Cash App." Takes 30 seconds each time but could save headaches later if you ever need to explain the transactions.

Have you considered using tax software instead? I have a small business (LLC) and two rental properties, and I use TurboTax Business. It costs me under $200 all in. Since you're already a CPA with Big4 experience, you probably have enough knowledge to handle it yourself and save thousands.

As someone who's been through similar fee discussions with my CPA, I'd suggest requesting a detailed engagement letter for next year that breaks down exactly what services are included in each fee component. The $1,500 "accounting work" charge is definitely worth questioning given your background and record-keeping quality. When I pushed back on similar charges, my CPA admitted they had automatically included certain review procedures that weren't necessary for my well-maintained books. For comparison, I have a professional services S-corp and two rental properties in a major metropolitan area, and I pay $1,200 for the business return and $2,200 for personal. The key difference might be that I established clear boundaries upfront about what accounting work I handle versus what they do. Consider asking them to walk through their specific value-add beyond basic compliance. Sometimes CPAs get into a routine of charging standard fees without considering the client's sophistication level. Given your Big4 background, you might be paying for services you don't actually need.

My brother didn't file for 3 years cuz he was "sure he didn't owe" and the IRS eventually caught up with him. They reconstructed what his income should have been based on third-party reporting and sent him a bill with penalties that was wayyyyyy more than if he'd just filed normally. Plus they almost went after him for tax evasion which is no joke. Just file your taxes people!!!

Just to add to what everyone else has said - even if you're 100% certain you don't owe taxes, there are actually several good reasons to file anyway: 1. **You might be leaving money on the table** - Like others mentioned, you could qualify for refundable credits like the Earned Income Tax Credit or American Opportunity Tax Credit that actually give you money even if you didn't pay any taxes. 2. **Proof of income** - Having a filed tax return makes it way easier to apply for loans, apartments, financial aid, etc. Landlords and lenders often want to see your tax returns as proof of income. 3. **Social Security credits** - If you earned income but don't file, you might not get proper credit toward your Social Security benefits later in life. 4. **Peace of mind** - Filing eliminates any worry about whether the IRS will come knocking later. It's one less thing to stress about. The whole process is honestly not as bad as people make it out to be, especially if your situation is simple. And if you're owed a refund, you're basically giving the government a free loan by not filing. Why let them keep your money?

I was in the exact same situation last year! As an independent contractor doing gig work, I spent way too much time worrying about Line 20 when it turned out I didn't need it at all. Here's what I learned: since you're doing Uber and delivery work as an independent contractor, pretty much all your work-related expenses (car expenses, phone, delivery equipment, etc.) go on Schedule C, not anywhere on Schedule 1. Your W-2 income just goes directly on your main 1040 form. Line 20 of Schedule 1 is really just for weird, uncommon situations that don't have their own specific lines - things like jury duty pay you had to give back to your employer, certain performing artist expenses, or repayment of unemployment benefits. For regular folks like us doing gig work, it's almost always going to be blank. Don't overthink it! If you don't have one of those unusual situations (and most people don't), just leave Line 20 empty and focus on getting your Schedule C filled out correctly. That's where your real deductions are going to be anyway, and they're actually more valuable there since they reduce your business income before it gets taxed. The tax forms seem super complicated at first, but once you realize that most lines don't apply to your specific situation, it gets much easier. You've got this!

I completely understand your confusion! Line 20 of Schedule 1 is definitely one of those areas that trips people up when they're doing their own taxes for the first time. Since you're an Uber driver and delivery person with a W-2 job, here's the good news: you'll probably leave Line 20 blank. Your gig work expenses (car costs, phone bills, delivery bags, etc.) all belong on Schedule C as business deductions, which is actually better for you since they reduce your business income directly. Line 20 is really a catch-all for unusual situations like: - Jury duty pay you had to return to your employer - Certain performing artist expenses - Repayment of previously reported income - Some very specific professional expenses for certain occupations For most independent contractors like yourself, these situations don't apply. Your Schedule C will handle all your business-related deductions, and your W-2 income goes directly on Form 1040. Don't stress about trying to find something to put on Line 20 - if you don't have one of those rare situations, it should be $0 or blank. Focus your energy on making sure your Schedule C is accurate, as that's where your real tax savings will come from. The IRS designed the forms so that common situations like yours have clear places for everything!