Here are several frequently asked tax questions and their answers. But like most things, there can be exceptions, so if in doubt, always ask for help.

Frequently asked tax questions

1. Is money earned through Venmo, PayPal, or Cash App taxable? It depends on why you received the money. Payments from friends for splitting dinner or reimbursing expenses are not taxable. However, money received for selling goods or providing services is generally taxable income and may be reported to the IRS on Form 1099-K.
2. Do I have to pay taxes if I sell items online? Maybe. Selling personal items for less than you originally paid generally doesn’t create taxable income, although the sale may still be reported to the IRS. If you sell items for a profit, the gain is usually taxable and should be reported on your tax return.
3. Can I deduct expenses for working from home? Employees cannot claim a federal deduction for home office expenses. Self-employed workers may qualify if part of their home is used regularly and exclusively for business purposes. The deduction can include a portion of rent, utilities, insurance, and other eligible costs.
4. Is cryptocurrency taxable? The IRS treats cryptocurrency as property, not currency. Selling crypto, trading one cryptocurrency for another, or using crypto to purchase goods and services can all create gains or losses that must be reported on your tax return. Even receiving cryptocurrency as payment, mining rewards, staking rewards, or certain promotional incentives may be taxable and must be reported on your return.

New questions to ask yourself

1. Is my tip income taxable? Tips are still considered taxable income and must still be reported. However, under the One Big Beautiful Bill Act, many workers in occupations that customarily receive tips can claim a federal income tax deduction for qualified tip income through 2028. To qualify for the deduction, tips must be reported on Form W-2, Form 1099, or other approved reporting methods, and the worker must be employed in a qualifying occupation designated by the IRS. The deduction is limited to $25,000 per year and begins phasing out for higher-income taxpayers. Social Security and Medicare taxes still apply.
2. How much of my overtime pay is deductible? Under the One Big Beautiful Bill Act, workers may deduct the overtime premium portion of qualified overtime pay through 2028. In a typical time-and-a-half situation, only the extra half-time portion is deductible, not the employee’s entire overtime paycheck. For example, if you normally earn $20 per hour and are paid $30 per hour for overtime, only the additional $10 premium qualifies. The deduction is capped at $12,500 annually ($25,000 for joint filers) and phases out at higher income levels. Social Security and Medicare taxes still apply.

Please contact our RRBB advisors to schedule a tax-planning session so you can be prepared to navigate potential tax surprises on your 2026 tax return.