Taxes on Freelance Income
As a self-employed individual or independent worker, you may find each day is completely new and different for you. Your flexible hours might leave you with extra time to spend with your family, or with just enough time to read that book that has been collecting dust on the shelf. As laid-back or busy as your schedule might be, use your self employed quarterly taxes to provide some structure to your work days and success.
So what’s the key to understanding the important connection between freelancing and taxes? Here are some tax tips for freelancers who are handling self employed quarterly taxes.
Your business income is your responsibility, and it can be a daunting one. However, understanding tax deductions for freelancers can alleviate the burden of this task. Tax deductions for freelancers work much differently for self employed individuals, as opposed to big corporations, because you are responsible for keeping careful records of your own expenses. While keeping these records may add to your daily workload, when it comes time to pay your taxes for freelancers, you can maximize your deductions and savings.
Understanding taxes on freelance income will play a key role when you encounter the 1099 self employment tax. The 1099 self employment tax must be attached to your tax return, in order to cover your social security and medicare taxes. If you have previously worked for an employer and are unfamiliar with the ins and outs of taxes on freelance income, the 1099 self employment tax may seem foreign to you. This is because you may be used to a W-2 form, which is given by employers to employees, to withhold payroll taxes from their earnings. As freelancers we didn’t have that luxury until now (you can thank us later)!
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Tax Tips For Freelancers
Freelancing and taxes can be made even simpler with the help of the right tax preparer. A tax preparer can provide even more tax tips for freelancers, with their superior knowledge of the ins and outs of freelance tax deductions. Freelance tax deductions allow you to account for the everyday costs of running your business, and in turn, they will lessen the cost of your taxes. Rent, office supplies and traveling expenses are just a few examples of costs that you may be able to receive freelance tax deductions for. The money you spend on hiring a tax preparer will likely be money saved when it comes time to pay your taxes on freelance income. Taxes for freelancers are complex in theory, but with the right support, and tax tips for freelancers, it’s a piece of cake!
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