Question about side work.

I believe I know the answer to this question and I feel like an idiot for even asking...but I couldn't find much of anything by searching Google, at least not a legitimate answer.

Is it always, 100% of the time, illegal to accept cash for services if you are not an independent contractor?

For example, a one time thing comes along where someone needs some PC/Network stuff done. You do it and decide it's worth a few hundred dollars. Is it illegal to accept money for the work unless you have registered a business and can pay taxes on it, or is there another way to pay taxes on the money, thus making it legal?

I'm just a little confused by this. I know it's illegal to accept money and not pay taxes, I just didn't know if there was some limit, etc.

I mean, this applies to any situation. What about helping someone with yard work for a day or something and getting paid $50. Is it illegal to accept that, too?

And yes, I am in this situation, that's why I'm asking.

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Comments

meadIT

You do not have to be a registered business to do work on the side. You do however have to claim the income on your taxes at the end of the year.

JDMurray

As long as you handle the legal tax implications, it's perfectly fine to accept currency, goods, or services in exchange for rendering a service. That's a fundamental part of the Free Market (unless Obama does something to change that).

/usr

What form would I use to do this, and is there a limit to the amount I can make and not be an independent contractor / registered business?

Claiming the income isn't a problem, I just want to be sure I'm legal in all of this, as I plan on doing more of this kind of work.

JDMurray

/usr wrote:

What form would I use to do this, and is there a limit to the amount I can make and not be an independent contractor / registered business?

Claiming the income isn't a problem, I just want to be sure I'm legal in all of this, as I plan on doing more of this kind of work.

Those are question for the person (or software) that prepares your State and Federal income taxes.

meadIT

/usr wrote:

What form would I use to do this, and is there a limit to the amount I can make and not be an independent contractor / registered business?

Claiming the income isn't a problem, I just want to be sure I'm legal in all of this, as I plan on doing more of this kind of work.

I don't think there is a limit that you can claim, but once you reach a certain amount of income, then tax-wise and liability wise, it is beneficial to register as a business.

darkerosxx

/usr, it's always best to check with your state and local government to check what rules they have for businesses. Many areas are different and some areas DO require all businesses to pay a license fee. Some require a license if you're making X amount of profit. Some don't require them at all.

It's best to cover your bases and look at the city/state you're based in to see what their regulations are.

Good luck!