When it comes to taxes, they do not always do what you want them to do. You must do the best that you can do for yourself and your family’s well-being.
Paying tax is important, they fund many things like schools, fire departments, hospitals, and more. And when it comes to paying taxes on taking online surveys, do you need to?
Table of Contents
- You do not need to pay taxes on survey income (that depends).
- Do surveys count as self-employment?
- Self Employment Income
- Know what needs to be reported on your taxes for self-employed income
- Know what deductions you can take
- Make estimated payments for your taxes
- Figure out your retirement plan
- Keep good records
- Do the IRS Consider Paid Surveys a Business
- How do I file my taxes if I have earned money from taking paid surveys?
- What do I do about paying taxes if I was paid in money?
- What do I do about paying taxes if I was paid in gift cards?
- Writing Off Expenses to Offset Taxes
- The Nitty Gritty of Paid Survey Income Taxation
- Bottom Line
You do not need to pay taxes on survey income (that depends).
You do not have to pay taxes when you do pay surveys, but it is a good idea for you to do so in case the survey company that you worked with is audited.
In this case, it is better if they have your tax documents showing your earnings from survey taking because they do not want to be like one of the many companies that do not pay their taxes and do not report their earnings or the sum total.
Although you do not need to pay tax on survey income, doing so is a great idea for those who do surveys as a hobby and do it all of the time because if they do get audited it will then look like a real business and not a hobby.
Many people are taking surveys for taxation dodge.
They do this because they do not want to pay their taxes, but do you need to pay them?
In most cases, the IRS has loopholes that can find out if your earnings from doing surveys are being reported on your income tax return.
Even though you do not need to pay taxes on online survey income, it is a great idea if those people do so because they do not want to be audited and do not want the IRS to find out about their earnings from doing surveys.
If you do any sort of work for someone else as an independent contractor then you do need to pay taxes on your survey income.
The IRS is cracking down on people who do not do their taxes properly. It can be hard to do if you do surveys on the side of your regular job, but you must do or else you might get in trouble with the IRS and they will take their money out of your checking account without telling you.
Even though do you need to pay taxes on your paid survey income is a question that does not have an easy answer, it is always better to do when it comes to earning money.
Doing surveys can be fun and exciting when you do them for real companies, but if they do audit the company where you do these surveys then it will look like you are doing surveys all of the time.
That’s a valid question. And with any valid question, you won’t find an easy answer. But here’s the closest you’re going to get:
1. Let’s file rule #1 under “better to be safe than sorry.” The IRS requires us all to claim every itsy-bitsy piece of income we make over the year, regardless of the source. You know that five bucks you got for helping your friend move ( some friend!)? The IRS’s take on that is you have to claim it.
With that understanding, the answer you’ll get from the IRS is that YES, you have to claim your paid survey income, which, in turn, means you pay taxes on it.
2. Let’s call rule #2 the “not-so-safe, but more regularly used” approach. This approach suggests one of two things, both based on how much you make per paid survey. The first is that if you get paid more than $99 on a survey, then you have to report it as taxable.
The second is if you get paid more than $600 by a survey panel in one year, then that panel will send you a 1099 tax form, and you have to claim that income.
See Related: Ways to Take Surveys for Miles
Do surveys count as self-employment?
The answer to the do survey count as self-employment question is simple.
Many people do surveys for an income, but even if you don’t get every survey offer available every day, the argument could be made that it still counts as self-employment because you do have control over your time to do surveys based on when they are available.
So do surveys online count as self-employment?
The answer is yes – at least in some sense of the word. If you couldn’t accept or reject a survey invitation should one come in, then I would say no.
But since there are so many options out there, including daily email notification services like Pinecone’s QuickSurveys®, I find it difficult not to view it as self-employment.
If you do a simple Google search, the do survey count as a self-employment question is brought up many times by users who do surveys for an income.
However, there are a few different factors that come into play if you decide to take survey opportunities.
Self Employment Income
Self-employment can be a great way to do something you love and make a living. There are many different ways to do self-employment, but self-employment income is not always easy to get.
It’s hard to set yourself up for success in this type of lifestyle, but there are a few things you should do before diving into it without giving it much thought. The following are what experts recommend when it comes to your taxes for self-employed income from survey sites.
One of the most important things when it comes to self-employment tax is making sure that you are paying the right amount.
You don’t want to pay too much or too little, and it is important to make sure that you are keeping track of everything. This can be a lot of work, but it is important
Know what needs to be reported on your taxes for self-employed income
It can be confusing when it comes to knowing just what has to be reported on your taxes because the IRS calls many different things “self-employed.” That’s why you’ll need to do a little research and determine which income falls into that category.
Know what deductions you can take
Depending on where your business is located, you may be able to deduct many different things related to your business expenses. Make sure you understand all of the possible deductions before doing any planning so there aren’t any surprises come tax time.
Make estimated payments for your taxes
It’s highly recommended that you do not wait until the end of the year to do your taxes. Your taxes are based on an estimate, so it helps if you do some type of payment each quarter so you don’t get stuck with a huge bill come April 15th.
Figure out your retirement plan
It’s never too early to do your taxes for self-employed income and start saving for the future.
Just look at recent college graduates who do not do their taxes and usually end up with a penalty (and lost interest) due to not understanding the rules about more than half of what they make being taxed for student loan income.
I do not think that is fair to do your taxes for self-employed income and have it double because you didn’t do your research.
Keep good records
You should keep all of your paperwork throughout the year so you can easily do taxes on self-employment income without too much hassle come tax time.
See Related: Ways to Get Free Cryptocurrency
Do the IRS Consider Paid Surveys a Business
The answer to do the IRS considers paid surveys a business is no. Please, don’t forget that you are filing taxes on your income outside of any other jobs you do. If you get money somewhere locally, then yes, the IRS will know about it because they require businesses to file taxes at each charge.
However, if it’s just for say extra money to do some light work on the side that doesn’t require much time or effort I haven’t seen this show up in any form or fashion during my years with this company.
There are plenty out there who do surveys on survey site regularly and pay their tax bills regularly without reporting anything illegal.
So do the IRS consider paid surveys a business would have to be answered no.
How do I file my taxes if I have earned money from taking paid surveys?
In general, you do not have to pay taxes on grants or prizes that do not require any services from you.
But if you do take part in paid surveys, do not be surprised that they do require services from you.
Survey income is taxable just like any other income that is earned through work. You do need to report this income on your tax return, no matter how little it might be, and pay taxes on it since the US Government sees survey income as earned income.
You do not need to pay taxes on the points that you earn with some survey companies, but do need to pay on any money that is transferred into your bank account or onto a gift card. This is taxable income and should be reported on your tax return every calendar year.
What do I do about paying taxes if I was paid in points that do not require any services from me?
There is no doubt about it, if you receive gifts or grants as prizes for taking surveys, the value of those gifts and/or grants do not count as taxable income. You do not need to pay taxes on such items.
What do I do about paying taxes if I was paid in money?
If you are receiving pay in cash from different companies, do not be surprised if this counts as taxable income! This can be anything from a check to direct deposit. It does not matter how you receive the funds; it will count as taxable income and you do need to pay taxes on such items.
What do I do about paying taxes if I was paid in gift cards?
It does not matter if you were paid with a gift card or an actual cashier’s check, do not be surprised that this counts as taxable income. This can be anything from Visa gift cards, to debit cards, and more. When you do receive money on these items, do not forget to include the value of such gifts as income on your taxes.
Writing Off Expenses to Offset Taxes
Let’s say you end up claiming your income from paid surveys. Does that mean you’re going to lose a chunk of it? Not necessarily.
Paid survey panels will treat you as an independent contractor, and the beauty of this freelance lifestyle is you can write off many things, so long as they have to do with your work. Here are some potential write-offs to help you offset your taxes:
- Part of your internet or phone bills
- Computer equipment
- A portion of your electricity bill
- Office furniture
Even, potentially, a portion of your rent/mortgage if you have a dedicated office
By writing off these expenses you can keep more of the money you made from your paid surveys for tax purposes.
See Related: Easy Ways to Get Free Google Play Money
The Nitty Gritty of Paid Survey Income Taxation
So, again, let’s assume you decide to claim your income, either because you’re being safe, or because you’ve made quite a lump sum (congrats!). How do you go about claiming this income?
For starters, these yearly earnings should be claimed under “other income” on your personal income taxes. But, if you want to take advantage of deductible expenses, you’ll want to fill out a Schedule C.
In fact, if you’ve made a fair amount of money with your paid surveys, then claim it under “other income,” and don’t fill out a Schedule C, the IRA will raise its eyebrow.
Another thing you must consider are 1099s. You should receive a 1099 from every paid survey company to cover your bases, and to look more like a legitimate independent contractor.
If you don’t receive a 1099 from every company, contact them to have them send you one.
See Related: Epic ways to Get Free Cryptocurrency
If you make close to peanuts on your paid survey income, chances are you don’t have to pay taxes on them, unless you’re sent a 1099. If you make a good chunk of change, you may want to play it safe, claim the taxes as “other income,” and write off some expenses using Schedule C.
Either way, the goal is to keep as much as you can, because earning money from paid surveys is hard work, right?
This is a piece contributed by Spencer Mitchell, the blogger who runs SurveySpencer.com. After spending the last 3-years filling out paid surveys he decided to help others avoid the all-too-common scams and make the most from their paid survey income.
Thanks to his dedication to filling out surveys for money he’s been “lucky” enough to claim paid survey income in his 1099. He’s a part-time stay at home Dad that lives in Wyoming with his wife and two daughters.
Want to make real money with surveys?
Sign up with SurveyExpress and instantly receive a list of the highest paying survey sites.
We hate spam just as much as you.