If you worked a second job, for instance at night or on weekends, you must report these earnings on the federal income tax return, the Internal Revenue Service said.
Some examples of "moonlighting," which produces income that must be reported, include an office worker who doubles as a baby sitter in his or her spare time, a newspaper reporter who writes free-lance articles, a public school teacher who tutors for pay, or a construction worker who picks up extra money doing home repairs on weekends.Income from any source is taxable, the IRS emphasizes, whether it is received in cash, property or services, unless it is specifically excluded by law.
Even if you do not receive a Form W-2, "Wage and Tax Statement," from an employer, income from moonlighting jobs must be reported on the tax return as wages or salaries. You should also be aware that you may have to pay estimated tax if little or no tax is withheld on the income from moonlighting jobs.
If an employer indicates that a Form W-2 will not be issued, you should keep your own record, including dates, names and addresses of employers, type of employment and amount of income. Because employers are required by law to issue a Form W-2, you should also notify the IRS.
Some people who do work in addition to their regular jobs are considered self-employed, not employees. Examples may include free-lance writers and repair persons who set their own schedules and work out of their own homes. These people also must report their income. Generally, they use Schedule C (Form 1040), "Profit or Loss From Business." If they have at least $400 net earnings from self-employment, they must pay self-employment tax, a form of social security tax, computed on Schedule SE, "Social Security Self-Employment Tax."
The IRS points out that if an employee incurs expenses in producing income, such as union dues or uniform expenses, they may be deducted as miscellaneous deductions on Schedule A of Form 1040, if the employee itemizes. Certain miscellaneous deductions are deductible only to the extent they exceed two percent of adjusted gross income.