the 1099 economy hit 70m americans. here's what that means for taxes.

the bureau of labor statistics reported in 2024 that 16% of the US workforce earns primary income as independent contractors. add in side income, and the number climbs to nearly 70 million americans. that's a profound shift from the w-2 era, but the tax infrastructure — and the software supporting it — hasn't caught up.

when the irs designed form 1099-nec and schedule c, they were designed for occasional freelancers and small business owners. the accountant or bookkeeper would gather receipts, calculate deductions, and file once a year. that workflow made sense in 1985. it makes less sense in 2026, when a creator is generating and managing income in real time across multiple platforms, managing contractors themselves, and trying to understand their tax liability before march rolls around.

the economic impact is real. creators and 1099 workers who haven't formed an llc or s-corp are often overestimating their tax burden, paying estimated taxes based on gross income rather than net profit, and missing deductions that could save them thousands. the irs estimates that the self-employed underpay by $122 billion annually — not because they're dishonest, but because the tools and guidance available to them are built for a different era.

what's changed: the 1099 economy is now the default for many. creators, consultants, and gig workers aren't supplementing w-2 income — they are the income. they're running real businesses. they need real tools. tools that live where they work, that understand their situation, and that don't force them into a "fill out this form once a year" workflow.

the next wave of tax software for creators won't look like turbotax or quickbooks. it'll look like the tools they already use: native to their phone, real-time, ai-assisted, and built on the assumption that managing money is continuous, not annual.