Definition
Work done for money through apps and websites, such as ride-sharing, delivery, freelancing or selling online; the income is taxable even without a tax form.
What it means
The gig economy, also called the sharing or on-demand economy, covers earning money through an app or website: driving or delivering, renting out property, doing tasks or freelance projects, and selling goods or creating content online. The IRS says gig income is taxable whether it is paid in cash, through a payment app or as goods and services, and whether or not you receive a Form 1099-K, 1099-NEC or other form. Most gig workers are independent contractors, so they may owe self-employment tax and need to make quarterly estimated tax payments. Business expenses such as mileage, fees and supplies can reduce the taxable profit. Keeping records of income and costs from each platform helps at tax time.
Example
A college student who earns $4,000 delivering food and $2,000 selling clothes online in a year has $6,000 of gig income to report, minus allowed expenses.
Illustrative numbers only. Your situation will differ.