If you're a gig worker, you probably know the freedom that comes with being your own boss. You set your schedule, choose your projects, and decide how to balance work and life. But, there’s one part of gig work that’s less about flexibility and more about stress: tax season.
With new changes and updates coming out every year, it can be hard to keep up. And if you're working multiple gigs, it only gets more complicated. Suddenly, you're not just tracking one paycheck, but you're juggling multiple streams of income, trying to figure out how to pay estimated taxes, and hoping you don't miss out on any deductions.
It can be overwhelming. But don’t worry! In this guide, we’ll walk you through the key updates for gig workers filing taxes in 2025. From the new rules to the forms you'll need and tips to make the process a little less taxing, we’ve got you covered.
Life in the World of Side Hustles and Self-Employment
Are you delivering lunch on a scooter, giving rides after your 9-to-5, running errands for neighbors, or freelancing from your laptop? If so, you’re part of the growing world of independent work. This flexible way of earning money is no longer a trend or fad–it’s quickly becoming a major part of how America earns a living.
In fact, more and more people are choosing the gig life. According to Statista, around 57.3 million people in the U.S. are now earning income through gig work. Meanwhile, a report from TransUnion shows that over one-third of gig workers rely on these jobs as their main source of income. That’s a significant shift—millions are trading traditional 9-to-5s for freedom and flexibility.
The Internal Revenue Service (IRS) considers you a gig worker if you earn more than $400 from self-employment in a year. So if you're driving for Uber, delivering food, designing websites, walking dogs, or writing content—congrats! In the eyes of the IRS, you’re officially running your own business.
What’s Changing with Taxes for Gig Workers in 2025?
If you’ve been freelancing or working gigs for a while, you might remember that you’d only get a 1099-K form if you got at least $20,000 in payments and had 200 or more transactions through platforms like PayPal, Venmo, or other third-party processors.
But times have changed. The gig economy is booming, and with that growth comes a surge in untaxed income. The IRS introduced new rules to catch underreported earnings and make sure gig workers are keeping up with their tax responsibilities.
Starting in 2025, gig workers who earn $2,500 or more through digital platforms will likely get a 1099-K. Then, the threshold will be lowered to $600 in 2026.
The IRS is also paying attention if you got payments of at least $600, whether from prizes or from gig work. That means even if you’re paid through a money transfer app or by check, and not directly through a platform, it might still be reported. The IRS will monitor these transactions through 1099-NEC and 1099-MISC reporting.
What Makes Taxes Different When You're a Gig Worker
When you’re a gig worker, there’s no payroll department keeping track of your income or taking taxes out of each paycheck for you. That part of the job is also yours now.
Unlike traditional employees, gig workers are responsible for tracking their own income, logging expenses, and saving those receipts if they want to claim tax deductions later. This includes anything you spend on your work—like mileage, supplies, software, or even a portion of your home office. If it helps you earn money, it might be deductible.
Since no one's withholding taxes for you, you’ll need to pay estimated quarterly taxes yourself throughout the year using Form 1040-ES. These quarterly payments help you avoid surprises and penalties at tax time.
For 2025, here are the deadlines set by the IRS to help you stay on track:
| Estimated Income Earned Duration | Tax Payment Due Date |
| January 1 to March 31, 2025 | April 15, 2025 |
| April 1 to May 31, 2025 | June 16, 2025 |
| June 1 to August 31, 2025 | September 15, 2025 |
| September 1 to December 31, 2025 | January 15, 2026 |
Taxes might seem a little more complicated at first. But once you’ve got a system in place, it won't be as complicated as you thought it would be. Preparing now can save you a lot of stress later.
What Taxes Do Gig Workers Actually Pay?
Another thing that gig workers need to be aware of is that they pay income tax like everyone else and are also responsible for self-employment tax. Because they’re working for themselves, they’ve got to cover both their share and the “employer” share of certain taxes.
And here is what that really means:
Self-Employment Tax: Your Social Security & Medicare Contributions
As a gig worker, you’re responsible for the self-employment tax, which totals 15.3% of your net income:
- 12.4% goes toward Social Security
- 2.9% goes to Medicare
If you worked a regular 9–5, your employer would pay half of these taxes. But since you're your own boss now, you foot the entire bill. The upside is that you’re still building toward Social Security and Medicare benefits down the line.
Now, if you earn more than $200,000 (single filer) or $250,000 (married filing jointly), there’s an extra 0.9% Medicare tax you’ll need to pay on the income above those amounts.
Also, for Social Security tax, anything you earn over $176,100 isn’t taxed—at least for that portion. But you’ll still pay the Medicare tax on all your income, no matter how much you make.
Income Tax
Then, there’s your regular income tax, which depends on how much you earn in total. Here are the 2025 federal tax brackets:
| Tax Rate | Single Filers | Married and Filing Jointly | Head of Households |
| 10% | $0 to $11,925 | $0 to $23,850 | $0 to $17,000 |
| 12% | $11,925 to $48,475 | $23,850 to $96,950 | $17,000 to $64,850 |
| 22% | $48,475 to $103,350 | $96,950 to $206,700 | $64,850 to $103,350 |
| 24% | $103,350 to $197,300 | $206,700 to $394,600 | $103,350 to $197,300 |
| 32% | $197,300 to $250,525 | $394,600 to $501,050 | $197,300 to $250,500 |
| 35% | $250,525 to $626,350 | $501,050 to $751,600 | $250,500 to $626,350 |
| 37% | $626,350 or more | $751,600 or more | $626,350 or more |
And don’t forget that state taxes might also apply, depending on where you live. Some states don’t charge income tax at all, but others do, so be sure to check the rules in your state.
When tax time gets tough, Giggle Finance has your back. Apply for a cash advance for gig workers to help you cover surprise expenses without digging into your tax fund.
The Forms Every Gig Worker Will Likely Need
As part of the gig economy, you're also responsible for filling out the correct forms.
First up is Form 1040, the standard tax return form. Make sure you attach Schedule C to report your income and expenses from self-employment and Schedule SE for your self-employment tax. Think of it as your way to show the IRS how much you earned—and spent—while doing your gig work.
Now, when it comes to proving your income, you’ll likely get Form 1099-NEC or 1099-MISC from any client who paid you more than $600 during the year. And if you got paid through apps like Venmo or PayPal, you'll get a 1099-K, as explained earlier.
As an independent contractor, you’re allowed to deduct half of your self-employment tax, which can help lower your overall bill. And when it comes to actually paying what you owe, you’ve got options:
- If you also work a traditional job, you can ask your employer to withhold a bit more from your paycheck by updating your W-4 form.
- If gig work is your main thing, you’ll want to stay ahead of the game by making quarterly estimated payments throughout the year.
Tax Tips Every Gig Worker Should Know by Heart
We’ve rounded up some practical, no-fuss tips to help you stay organized, avoid surprises, and even keep more of your hard-earned money in your pocket.
1. Keep Your Records Clean and Simple
One of the smartest things you can do is separate your business and personal finances. Open a dedicated bank account for your gig income and use it only for work-related expenses. Buying new tires for your Uber car? Use your business account. Ordering pizza for movie night? That goes on your personal card.
Apps like QuickBooks, FreshBooks, and Moves can track expenses for you and keep everything organized in one place. You don’t need advanced skills—just consistency. The more accurate your records, the easier tax time will be.
2. Set Aside Around 30% of Every Paycheck
When money comes in, it’s tempting to spend it right away. But remember, the IRS isn’t taking money out of your pay automatically like they would with a traditional job.
A good rule of thumb is to save about 30% of your income for taxes. Every time you get paid, move a third of it into a high-yield savings account or a money market account—somewhere that earns a little interest but is still easy to access when tax time rolls around. This way, you won’t be scrambling to pull together a big payment in April.
To help you see a clearer picture of how much you’ll owe, use a tax calculator designed for gig workers. Some calculators you can use are the IRS Tax Withholding Estimator and TaxAct Tax Bracket Calculator.
3. Don’t Miss Quarterly Tax Deadlines
If you're earning a steady flow of income through gig work, the IRS expects you to pay taxes throughout the year—not just in April. That means making estimated tax payments every quarter, based on what you expect to earn. So, make sure to stay up to date with the deadlines so you don’t risk missing a payment or filing late.
You can send in your payments with Form 1040-ES or pay online through the IRS website or the IRS2Go mobile app. Here's a pro tip: setting reminders on your phone can save you from those late-payment penalties.
4. Don’t Forget About Deductions
If you’re spending money to run your gig business, chances are you can deduct those expenses. For example:
- Rideshare drivers can deduct mileage, car maintenance, and even part of the phone bill.
- Freelancers or remote workers might qualify for the home office deduction, as well as expenses such as software subscriptions, internet access, and office supplies.
5. Embrace Automation
Automation is a game-changer for gig workers, especially as tax rules get more complicated. Manually tracking everything leaves room for mistakes, missed deductions, and even penalties.
Smart tools can take that pressure off. They automatically log your income and expenses, categorize transactions, sync with accounts like PayPal or Venmo, and calculate potential deductions along the way.
When tax season hits, everything’s already organized. No digging for receipts or entering numbers by hand—just generate a report and hand it off to your accountant, or file with confidence. Many tools also show real-time insights into your tax liability, helping you stay on track all year and avoid any surprises.
Your Gig Tax Game Plan
Tax season might not be the most exciting part of being a gig worker, but it’s definitely one of the most important and needs your full attention. With changing IRS rules and the responsibility of paying self-employment tax, it’s a must to stay updated and on top of things. From tracking your income and expenses to making quarterly payments and claiming deductions, a little planning goes a long way.
But even with all the right planning, tax season can throw surprises you're not equipped to deal with. Maybe your car breaks down the week before your quarterly tax payment is due. Or you find out you owe more than expected, and your savings are looking a little thin. Giggle Finance can help in these situations. We’re here to help you handle those surprise expenses without stress.
With Giggle Finance, you can access fast, flexible funding when you need it most—without the complicated stuff. We only offer a straightforward way to cover your costs to help you stay on track and move forward.
Here’s how it can help with real-life gig worker situations:
- The Unexpected Car Repair
You’re an Uber or Lyft driver and suddenly your car won’t start. That’s your whole income on pause. Giggle Finance gets you quick cash so you can fix your ride and get back on the road—no waiting around. - Surprise Tax Bill
You thought you saved enough, but when the tax software finishes crunching numbers… surprise! You owe way more than expected. Giggle Finance can cover the difference and avoid late fees or penalties. - Replacing Business Essentials
Your phone dies and, unfortunately, it’s how you take gigs, track miles, or process payments. Giggle Finance's funding helps you buy a new one ASAP so you don’t miss a booking. - Starting or Expanding Your Side Hustle
Want to attract more clients or boost your freelance gig? Maybe that means investing in new tools, a better laptop, or upgraded software. With Giggle Finance, you can purchase the essentials without draining your bank account. - Catching Up on Missed Quarterly Taxes
Life happens, and you missed a quarterly tax payment. Don’t stress—use Giggle Finance to get caught up before penalties stack up.
Why Gig Workers Love Giggle Finance
- Fast Access to Cash
Apply in minutes and get funded quickly. - No Credit Requirements
We know your worth isn’t tied to a number. - No Hidden Fees
Transparent terms from the get-go. - Funding up to $10,000
Cover whatever you need to cover. If you're renewing, you could get funding up to $20,000. - Tailored for Gig Workers
Built with your hustle in mind.
So, while taxes might not be your favorite part of being self-employed, they don’t have to be overwhelming. With preparation and a financial backup like Giggle Finance, you'll be able to handle it with ease.
Need help covering surprise expenses? Don’t let tax season get you down. Apply for Giggle Finance's cash advance for the self-employed today and get the cash you need to keep your gig going strong.
Disclaimer: Giggle Finance provides Revenue-Based Financing programs for business purposes only. Any mention of any loan product(s), consumer product(s), or other forms of financing is solely for marketing and educational content purposes and to help distinguish Giggle Finance’s product from other comparable financing options available in the market.