Gig Workers and Taxes

Tax Day is fast approaching

If 2021 was your first year in the gig economy then tax time will be full of surprises for you.
Most likely not very pleasant surprises either
Higher than expected tax liabilities
Even some penalties

Not much fun dealing with all of that.

What to do now?
Get some strong coffee (or your favorite give-me-energy drink)
And start on your paperwork.

Process your paperwork (get help, if necessary).
And file your taxes.

Tax time it’s a stressful time for many.

Now it’s the best time to start thinking, and planning, for next year
Think about how to make it easier on yourself when next tax filing comes around

Here are three things to get you started on the right track:

  1. Income
    Keep track of your income.
    Make sure to keep good records.
    The companies you work with will issue you 1099-NEC and other 1099s
    Do remember:
    The companies will also send copies of these forms to IRS
  2. Expenses
    Keep track of work-related expenses: car maintenance and repairs, work supplies, etc.
    These expenses will help lower your tax bill
  3. Taxes
    Put aside ~20% of your income. Save that money for taxes.
    (If necessary, and to avoid penalties, you may want to make estimated payments.)

That’s it!
Develop a system when you se aside time (weekly or monthly ) and do these.
And I promise you:
Consistently doing these 3 things will make tax time much less stressful.

Wishing you success in all you do

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Absentee leader: the most destructive type of leadership

Distant
Diminished communication
Lack of trust

These are trademarks (just a few) of an absentee leader.

Research published in German psychology journal Zeitschrift für Psychologie:
The effect of absentee leadership is far worse than any other type.

You think this ‘leader’ was bad before?
The impact is much stronger in the current (remote work) environment.
That’s when bad leadership becomes destructive.

As employee you are looking for feedback.
You want to know where/how to best direct your efforts.
But the leader is absent.
You have no guidance.

The results?
Stress and poor performance.

Significant problem
This leader (in title only) has a negative impact throughout the organization.
Heavy price to pay.
For the employees, the organization and its customers.

Why do they get away with it?
Because other (bad) leaders have a more glaring incompetence.
So we prioritize their removal.
And we let the quiet, incompetent (absentee) leader to continue to slow-kill the productivity and success of the organization

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Be ONE


One July afternoon.
People walking together.
All as one.

A group of people with different backgrounds.
People with ties to three continents.
Europe. Africa. North America.
All walking together.
All as one.

A group of people with different socioeconomic backgrounds.
Some have their kids taking piano lessons. Others tennis lessons.
And some work hard just to make ends meet.
All walking together.
All as one.

A group of people of different demographics.
Young, and young at heart, all walking together.
All as one.

What does it take to get people together?
People from different backgrounds?
Different socioeconomic classes?
Different demographics?

A call for help.

Just a few words:

Need Help!!!
Sunny flew away.
If you see him, please call me

And within minutes (literally) a group was formed.
And start searching for a lost, and scared, little Sunny.
My feathered-kid.

This happened two years ago this month.
And for me it’s still a lesson that keeps on giving.
A lesson in kindness.
A lesson of what it means to live in a strong, closely-knit community.

“… my husband and I will be there in 10 min.”
Janet and Steve – husband and wife team
You both, and Jill, (the ‘first responders”) provided much needed support from the beginning.

“When you get him home, his feathery little butt is grounded, really!!
Robin, using ‘when” not ‘if’ – words are important.
And can make a big difference. It gave me much needed hope

“Come inside. You need to eat something!”
Kay Lynn, insisting to feed me breakfast..
(I didn’t. But before I turned to leave there was a coffee in my hand.
Strong, much needed coffee.)

You and Dave helped so much.
Especially that evening when Sunny was hovering above.
And you stopped the cars from entering the street.

And many other acts of kindness.
But I’ll stop here.

What was NOT said was just as important.
NO ONE pointed out the obvious mistake I’ve made:
Not keeping Sunny’s wings trimmed.
They knew I was thinking – and berating myself about it – EVERY second.
Sometime being kind is just NOT adding more to the burden someone is already carrying.

 *   *   *   *   *   *   *

I’m forever grateful for all your help
And your kindness
(You can read here about Sunny’s adventure)

Where we are today
I believe our community is as strong as ever.
Yes, we do have some challenges ahead of us.
But what makes it even more challenging is the media.

The media – and its ‘fear porn’ reporting – is influencing our daily lives.

Yes, we need to take safety measures.
For us and our loved ones.
For our community.

But we can NOT, and should NOT, stop living our lives
We can’t allow media (with its sensationalized, attention-grabbing reporting) to turn us into shadows of our former selves.

Be safe
Be strong
Be ONE.

 

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Lobbyists, Loopholes, and the Paycheck Protection Program

Want money? No problem. How many millions?
And don’t worry about paying it back.
Enjoy.

What’s that all about?

Paycheck Protection Program (PPP)
The PPP was supposed to help struggling small-business to keep afloat during this economic crisis.
But it turned into “free money,” grab-as-much-as-you-can for publicly traded companies.
(Results of intense lobbying efforts prior to passing the CARES Act.)

Some of these companies are worth hundreds of millions.
These businesses pay seven-figure salary to their top executives.

The only thing ‘small’ about these businesses is their sense of decency.

How much money we are talking about?
The CARES Act allocated $349 billion for PPP.

Funds were completely gone within 2 weeks.

Yes, you read that right: 2 weeks.

True, some of these companies returned the money.
How magnanimous of them, right?
(No. They got caught; and exposed in social-media.
Returning the money was part of their damage-control PR.)

How did this happen?
Well, they didn’t do it alone, for sure.
They’ve had help.

Some say “they took advantage of the loopholes.”
Others say the loopholes were built-in the program.

I do know one thing for sure:

You and I helped as well.
How?
We elect the politicians.
We vote; then we go about our daily life.
And trust that they are doing what they got voted in for.

Meanwhile, big business and other special interests know better how the system works.
They hire lobbyists.
And sent them to Washington.

Then Congress starts giving out ‘party favors’ to the highest bidder.
(Read that: the ones with the best lobbyists.)

And they keep doing it.

Why?

Because we don’t hold them accountable for their actions

What’s been done about this?
No problem, we’ve taken action.
We’ve allocated another $310 billion to the Paycheck Protection Program.

This brings the total up to $659 billion.

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Conferences and speakers — yawners and winners

Conferences are great for meeting interesting people.
And hearing inspiring, motivating speakers.

But then… there are times when the conference is less than stellar
It doesn’t really live up to its promotional hype.
That was the case with a Las Vegas conference my friend and I went to recently.
The speakers were, for the most part, adequate.

But then, one afternoon we got “lucky.”
The speaker went on and on.
A real “yawner.”
As soon as it was over we bolted out of our seats.
Since we had some time before the next event, we went for a walk.

We stop at a coffee shop.
My friend goes inside to get something strong.
(Preparing for the next speaker?!)
I stay outside.

Betty Jane
As I’m checking my phone messages I hear:
“Well, well! Hello, Betty Jane!”
I’m looking up.
Striking, blue eyes.
He’s smiling. And waiting.

The opening line got my attention.
I’ve never been called that before.

Just then my friend comes out with coffee.
I look at the time — we have less than 10 minutes to get back
We need to start walking (running?)

Regretfully, I smile, turn around, and leave with my friend.
No time to find out who/why “Betty Jane.”
Need to get back to the conference.

What makes a good speaker?
This time the speaker is outstanding.
Speaks to our brains. And hearts.
A winner.

What makes a good speaker?
Start with the 3 C’s: clear, concise, confident.

Clear
Be clear about your message.
What are you trying to convey to your audience?
And why should they care?

Concise
Avoid TMI (too much information).
Because it can confuse or overwhelm the listener.
And that will detract from the effectiveness of your message.

Confident
Know your topic.
And be passionate about it.

Care about your topic.
Care about your audience.
And you’ll have the confidence to deliver your message.

 

*    *    *    *    *

Master these 3 C’s and you are on your way to a great start.

Wishing you success in all you do.

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How important is to have a good teacher for your child?

Good teachers.
A Stanford study show how students learn and perform three times better when they have a good teacher.

Three times better!

“No other attribute of schools comes close to having this much influence on student achievement,” says Stanford economist, Eric Hanushek.

Similar findings in a study at the University of Melbourne (65,000 research papers).
After taking in account other factors (class size, etc.) the results show how important is to have good teachers.
If we want children to have a top-notch education then we need top-notch teachers.

Some say teachers are under-trained.
And teaching methods currently used are obsolete.
Others say that technology and innovation will make bad teachers good and good teachers better.

What do you think?

Knowledge, high tech — and, voila, there is a good teacher?!

What makes a good teacher?
Yes, we need well-trained, knowledgeable teachers.
And technology/innovation does play a central role.
But if that’s all there is, that’s the makings of a mediocre teacher.

What makes a good teacher?
Ask children.
They KNOW.
Children are smart that way.

The good teachers CARE.
Even when they don’t say so.
Their actions speak volumes.

Growing up, I was lucky.
I’ve had some really good teachers.
As I wrote in here, some of them weren’t exactly the “cuddling” type.

Notwithstanding, I knew how much they wanted me to succeed.

Like the time when my French teacher adamantly told me,

“No! The school you chose is not good enough.

You need to go to the one in the capital.

That school it’s better for you.

If necessary my husband will tutor you.

Free of charge.”

It was difficult to get into the school my teacher wanted me to go to.
I needed to be at the top of my game.
And even then, because of so many applicants, my chances of getting in were slim, at best.

*    *    *    *    *

Outside of family, teachers play the most important role in a child’s life.

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Are schools doing a good job of preparing students for the future?

We are at crossroads.
The economic landscape is rapidly changing.
And the skills required to enter the workforce of the future are vastly different than before.
 
Are teachers skillful enough?
Are parents involved enough?

These and other questions are often asked.
 
Skilled teachers are essential to a good education
If you have any doubts about how important this is just look up American educator, Jaime Escalante.
He taught calculus in East Los Angeles.
Some of his students went on to Harvard, Stanford, and MIT.

Why is this unusual?

Over seventy percent of his students came from a poor socioeconomic background.
And some lived in gang-infested areas.
Yet, one dedicated teacher inspired them to learn.
Inspired them to take a different path and succeed.
Proof, once again, education is a great equalizer.

Skilled teachers are essential to a good education

My teachers — not exactly the cuddling type
I’ve had some great professors.
Even though some of their words of encouragement were quite unusual.

Growing up, I was sent to represent my school at Olympiads.
Math and literature.
Apparently both hemispheres of my brain are working.
(At least several times a year.)

My teachers (not exactly the cuddling type) didn’t want me to have a big head.
Their “words of encouragement” to me:
“Remember, where there is a lot of intelligence there is also a full truck-load of stupidity.”
They were wrong — sometimes there are two.
(One for each hemisphere?)

Whatever methods they use — great educators inspire you to do better.
And be better.
I’m forever grateful to my teachers.

Teachers, parents, friends, and internet
In upcoming posts on this blog we’ll take a closer look at education.
We’ll look at some of the recent studies.
Discuss the results.
Analyze what worked. And why.

We’ll also talk about teachers, parents, friends, and internet.
All have a major role in our students’ education.

  *    *    *    *    *

Until we meet again,
Wishing you success in all you do.

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Your gig is getting noticed

You are getting noticed.
(Maybe not the kind of attention you would like?)

According to an article in Forbes, more than a third of country’s workers participate in the gig economy.
That’s close to 60 million workers.
The gig economy, aka sharing economy, is expected to grow.
What does that mean for you, gig economy worker?

Well, among other things, it means Treasury Inspector General of Tax Administration (TIGTA) is taking notice. And so is the Internal Revenue Service (IRS).

“… we could benefit from the development of a comprehensive strategic plan to address the gig economy as well as any potential noncompliance resulting from it.”

said Mary Beth Murphy, commissioner of the IRS’s Small Business/Self-Employed Division (in response to recommendations from TIGTA).

The government tax authorities are starting to pay more attention to you.

IRS is starting to focus on your tax compliance
Aren’t you happy to finally get noticed?!
(Ok, that wasn’t funny.)

If you are a gig economy worker, you need to get comfortable with this new found “fame.”
You need to get comfortable with the idea that you may (potentially) be questioned by tax authorities.
Why?
Because you work for yourself you are now considered a small business owner.
And you are responsible to keep track of your income and expenses.
Here are 3 key points for you to remember:

Income
Don’t discard any 1099 form that you receive. YES, you guessed it — the IRS gets a copy too.
1099 or not, you need to keep track of any business-related payments you receive.

And include them in your income when filing.

Expenses
Make sure you keep good records of your deductible (business-related) expenses.
Deductible expenses may include exchange fees, office equipment and supplies, home office deduction, payment processing fees, and other expenses you incur as you derive your income.

Important: make sure you have documents to prove all the expenses you claim.
And remember: personal expenses are not deductible.
Keep them separate from business expenses.

Taxes
You now have the “privilege” of paying your own taxes.
(Welcome to the self-employed world.)
Your tax responsibilities may now require that you pay estimated taxes.
Otherwise, when you get ready to file you’ll get the “surprise” — a large tax bill.
With penalties and interest.

Bottom line
Whatever your gig is, as long as you remember to keep good records, and pay your taxes when due, then it should be smooth sailing.
Congratulations on being a new business owner!
Wishing you success in all you do.

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Personal Leadership and SMART goal setting

“If I had six hours to chop down a tree,
I’d spend the first four sharpening the axe”
said Abraham Lincoln

That’s exactly how successful people think about goal setting.
They work smarter. Not harder.
Successful people set SMART goals.

What are SMART goals?
Having SMART goals means you know what you want.
And you have a plan on how to get it.
SMART is an acronym for specific, measurable, attainable, relevant, and timely.

Specific
You start by clearly defining the goal you want to accomplish.
You need to know the why, who, what, where.
(Who is involved? What needs to be done?)
It’s important to know the WHY behind your goals — that’s what makes them come alive.
That’s your motivation.
It’s the fuel that takes you from where you are to where you want to go.

Measurable
Whatever your goal is make sure you have a way of measuring its progress.
Keeping track of your progress helps you stay motivated.

Example:
Let’s say you want to go on an “electronic diet.”
Tracking how much time you spend looking at various electronic screens will tell you if you are moving into the right direction. Or you need to adjust course.

Attainable
This means setting realistic goals.
Ask yourself, “Do I have the necessary resources to reach my goal?”

Example:
A high school student loves two things: math and playing sports.
Enjoys playing basketball — and is really good at it (in spite of being only five-foot tall).
A future mathematician or a professional basketball player?
The answer is obvious. Student’s efforts are best directed toward a career in mathematics.
That’s far more attainable than the alternative.

Relevant
Is this goal worth your time and effort? Is it in alignment and /or will it bring success to your other goals?
Another key question to ask yourself: is this goal really important to you?
Or you chose it because someone else thought this would be good for you?
Make sure you have the right answer.
Goals need to be relevant and in sync with the big picture of whatever it is you want to achieve.

Timely
This answers the WHEN question.
You have a specific period of time allocated to achieve this goal.
“I want to be in shape, I want to be fit” is not specific enough.
Say this instead, “I want to do 10 one-arm push ups by the end of this month.”
(That’s my utopian dream  : )
Goals need to have a time frame in which they are to be achieved.

To recap:
SMART goals are specific, measurable, attainable, relevant, and timely.
SMART goal setting will transform your vision into reality.

Start today. And don’t hold back.

As Mark Twain said:

Throw off the bowlines.
Sail away from the safe harbor.
Catch the trade winds in your sails.
Explore.
Dream.
Discover.

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Note to self: think before saying YES

Close friends hear me say this often,
“I don’t wanna think too much — it gives me a headache.”
The problem with that? I’m actually practicing it.
Done it all throughout this month.

Client: Applying for a loan and we need YTD financials by next week. If we send you the paperwork today can you help us?
Me: Yes, you’ll have your financials by next Wed.

Local college: this is kind of a short notice for teaching a class but…
Me: Yes — it can be done.

Out of town friend: Our trade association would like to invite you…
Me: Yes, I’ll be there

Friends: We are going to a family reunion. Could you take care of our pets?
Me: Yes, of course!

If you’ve been reading this blog for a while you know I usually say:
Choose your projects carefully!
Say NO to good projects.
Only then you can say YES to greater opportunities.

Obviously “Dr. Mariana” is not taking her own advice.
Not taking my own advice meant working 14-16 hours days.

Working way too much. Fortunately there were some light moments too.
Provided by Flipper and my coworker.
(I had someone helping me with the financials for a few days.)
Sharing the work load made it easier — I could concentrate on tax work while he processed the data for the financials.

All was going well. We were both working.
Flipper and Sunny were nearby, on their stand.
Suddenly I hear, “Ouch!”
I look up to see Flipper fanning her tail; and whistling — mighty proud of herself.

What had happened: my coworker picked her up. And she nipped his finger.
Not hard — just making sure he knows she’s the boss.
I look at them — now she’s on his arm, cooing like the little fluff ball that she is.
And that was before he brought over her favorite food — pizza.

One thing I do know for sure — if Flipper gets feisty like that it’s because she feels safe.
Otherwise she’ll stay away.

In conclusion:
Things can get really hectic — if we allow it.
Do remember: think before saying YES to any projects.
(And I’ll try to remember that as well : )

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