Gig work

What It Means

Gig work is earning money from short, on-demand jobs, services or sales, usually matched to customers through an app or website. The IRS, which also calls this the gig or sharing economy, counts driving for rides or deliveries, renting out property or equipment, running errands, selling goods online and offering creative or professional services. People do it part-time alongside other work or as their full-time living, and the IRS treats all of it as taxable income.

How People Say It at Work

• "I do deliveries on the weekends through an app."
• "Gig work pays the bills between contracts."
• "Did the app send you a tax form this year?"

The Breakdown

How the 1099-K rule works, per the IRS. The 2025 tax law the IRS calls the One, Big, Beautiful Bill restored the Form 1099-K threshold that applied before 2021, and made it retroactive. A payment appPeer-to-peer paymentMoney sent directly from one person to another through a payment app or a bank's app, such as Zelle, Venmo or Cash App. See more or online marketplace must send you a 1099-K only when your gross payments for the year exceed $20,000 and the number of transactions exceeds 200. Payments taken by credit or debit card are a separate case and are reported in any amount.

Worked example. Sam delivers groceries through one app and sells prints through an online marketplace in 2026.

Sam reports the full $26,500, minus what the work cost him, whether or not a form arrives for the marketplace sales.

What moves the result

• Whether you pass both limits on a single platform; a payment app counts only what went through it.
• Card payments, which follow their own rule.
• How the platform classifies you. Pay as an employee arrives on a W-2 instead.

Good to Know

The IRS says you must report gig income on your tax return even if no Form 1099-K, 1099-NEC1099 contractorAn independent contractor whose pay a business reports on Form 1099-NEC; they're self-employed, so no tax is withheld and they owe self-employment tax. See more, 1099-MISC or W-2 shows it. If you work as an independent contractor, net earningsNet incomeWhat's left after everything is taken out: on a paycheck, pay after taxes and deductions; for a business, profit after all expenses and taxes. See more of $400 or more mean self-employment taxSelf-employment taxThe Social Security and Medicare tax self-employed people pay on their own profit: 15.3% of 92.35% of net earnings, owed once those reach $400 a year. See more of 15.3% on 92.35% of those earnings, and you may need quarterly estimated payments. Whether a gig worker is an employee or a contractor follows the IRS's usual test of control and relationship, and a tax professional can help if the platform's label doesn't seem to fit how you work.

Related Terms and Categories

• Side hustle

  Paid work done alongside a main job or other commitments, such as freelancing, delivery driving or selling goods; the IRS treats the income as taxable.

• Freelancing

  Working for yourself, selling your skills to different clients by the project or the hour instead of holding a long-term job with one employer.

• 1099 contractor

  An independent contractor whose pay a business reports on Form 1099-NEC; they're self-employed, so no tax is withheld and they owe self-employment tax.

• Self-employment tax

  The Social Security and Medicare tax self-employed people pay on their own profit: 15.3% of 92.35% of net earnings, owed once those reach $400 a year.

• Quarterly estimated taxes

  Tax paid to the IRS in four installments during the year on income with no withholding, such as self-employment profit; due April, June, September and January.

Work, career and remote life