Tax basics for Runners
It’s tax time — are you ready?
Updated January 2024
How do you handle taxes when you work for yourself? We know filing taxes can be tricky, especially for independent contractors. That’s why we’ve answered our Runners’ most pressing tax questions to help you navigate the process and file your return like a pro.
As an independent contractor, you are responsible for keeping track of your earnings and accurately reporting them in tax filings. Runner earnings can be found in the Runner app. If you have any questions about what to report on your taxes, you should consult with a tax professional. Favor cannot provide you with tax advice nor can we verify the accuracy of any publicly available tax guidance online. You should always report earnings according to tax laws and consult your own tax advisors.
Keep in mind that the following is not tax advice and you should always report earnings according to tax laws.
Are there any tax filing changes this year?
There are no changes for the 2022 tax year. Previously, the IRS stated that they would be lowering the threshold for a 1099-K from $20,000 and 200 transactions to $600 and any number of transactions. However, they have since delayed this change, and the threshold for this tax year is still $20,000 and 200 transactions.
Similar to last year, we will only be reporting your gross earnings in Box 1A. This includes your earnings and any reimbursements, if applicable. Unlike previous years, it will not include the cost of goods or other unrelated items, such as delivery fees or cost of items purchased.
What is the difference between an independent contractor and an employee?
One of the key differences between an employee and an independent contractor is that taxes are withheld for one and not the other.
As a Runner, you have an independent contractor relationship with Favor. You are not an employee and do not have taxes withheld from your earnings. In other words, you are your own boss — and that means you are responsible for tracking your own gross earnings and expenses for tax purposes.
Which tax forms will I receive?
As an independent contractor, you may receive Form 1099-K instead of Form W-2 you may be used to getting as an employee of another company. We do not send out Form W-2s or 1099-NECs to Runners.
Runners who processed at least 200 payment transactions AND generated at least $20,000 in gross payments during the tax year will receive a Form 1099-K. If you do not meet both of these requirements, you will not receive a Form 1099-K.
What is a Form 1099-K?
Form 1099-K is an official Internal Revenue Service (IRS) tax document that includes a breakdown of your annual gross earnings as an independent contractor with a company.
Do I still need to file taxes if I don’t qualify for Form 1099-K?
You are required to file taxes even if you did not receive Form 1099-K. Favor provides a summary of your yearly gross earnings in the Earnings section of the Runner app. You can use this information to calculate your total earnings for the previous year and determine your tax liability.
When will I receive my Form 1099-K?
Favor will email Runners in late January to let them know their 1099-K status. If you do not receive an email by mid-February, please contact Runner Support. The physical copy of Form 1099-K will be sent to the address on file with Favor, and we encourage you to double-check that the address in your profile is up to date. Please note, the physical copy may not arrive for two to four weeks after January 31.
When do I need to file my tax return?
The deadline to file 2022 federal and state tax returns, or an extension with the IRS and applicable states, is April 15, 2024.
Ready to get started?
Favor has partnered with Stride, a company that helps you save time and money on insurance and taxes, to make the filing process a breeze. With the Stride app, you can take advantage of resources like:
- Free expense and mileage tracking with deduction suggestions
- Free tax guides, articles, and webinars
- Simple, integrated tax filing with TurboTax (with a discount!)
Download the Stride app today!
Need more help?
Check out these additional resources:
This blog is for informational purposes only. Favor is not offering tax advice or responsible for the information provided by any third party, including Stride. Please see your own tax advisers.
Have questions? Our Runner Support team is here to help!
