Tax season is just around the corner. The beginning of each year brings resolutions, a new start, and a review of last year's finances. Depending on your employment and your life situation you will either be required to pay taxes or you will receive a tax return.
Deductions allow you to reduce the amount you have to pay or may increase the amount of money you are paid in your return. While there are some obvious deductions you want to include, there are several that people overlook every year. All of these may not apply to your situation but it is good to know about them as they may apply in the future.
But the easy and potentially substantial income that is attached with freelance work still needs to be accounted for in the form of taxes; and, unlike those who are working for a structured company or organization, those who perform freelance work have the added responsibility of keeping track of their own taxes.
In a company or organization, it is most often the case that the employer will withhold a certain percentage from each paycheck so that a person can fill out a W2 tax form during the tax season and pay their taxes from those withheld funds, but for freelancer this is not the case.
Freelance workers, no matter what the duties are that they perform, are considered independent contractors under the tax codes of the United States, and therefore must fill out and comply to the tax regulations attached to the tax form labeled 1099. A 1099 tax form is the freelancer's version of a W2 and will help to classify their taxes accordingly.
The first tip that freelancers who are trying to report and keep track of their taxes need to know is that there are different forms of 1099s that are used to report various types of income from freelance work and knowing which form to fill out and report with will be the first step in successfully completing your tax filings.
Tuition - There are several deductions and credits related to higher education. If you're a student, you want to make sure that you do not miss out on those. The amount that you are able to deduct depends on your income, so check with an accountant or tax professional to see what you qualify for.
Mileage - This is a pretty big one that many people fail to take advantage of. You are allowed to take a per mile deduction for any miles you put on your car as long as it is for business, moving, or charitable work. The rate per mile varies for each of these so check the federal guidelines to see how much of a deduction you get.
The world of taxes can be a disastrously complicated place, especially once legal actions are taken by the IRS. To help you with all of your freelance tax questions and issues, first contact a professional tax accountant to help file your taxes correctly and then contact a certified tax lawyer if legal issues arise in your tax reporting as a freelancer.
Deductions allow you to reduce the amount you have to pay or may increase the amount of money you are paid in your return. While there are some obvious deductions you want to include, there are several that people overlook every year. All of these may not apply to your situation but it is good to know about them as they may apply in the future.
But the easy and potentially substantial income that is attached with freelance work still needs to be accounted for in the form of taxes; and, unlike those who are working for a structured company or organization, those who perform freelance work have the added responsibility of keeping track of their own taxes.
In a company or organization, it is most often the case that the employer will withhold a certain percentage from each paycheck so that a person can fill out a W2 tax form during the tax season and pay their taxes from those withheld funds, but for freelancer this is not the case.
Freelance workers, no matter what the duties are that they perform, are considered independent contractors under the tax codes of the United States, and therefore must fill out and comply to the tax regulations attached to the tax form labeled 1099. A 1099 tax form is the freelancer's version of a W2 and will help to classify their taxes accordingly.
The first tip that freelancers who are trying to report and keep track of their taxes need to know is that there are different forms of 1099s that are used to report various types of income from freelance work and knowing which form to fill out and report with will be the first step in successfully completing your tax filings.
Tuition - There are several deductions and credits related to higher education. If you're a student, you want to make sure that you do not miss out on those. The amount that you are able to deduct depends on your income, so check with an accountant or tax professional to see what you qualify for.
Mileage - This is a pretty big one that many people fail to take advantage of. You are allowed to take a per mile deduction for any miles you put on your car as long as it is for business, moving, or charitable work. The rate per mile varies for each of these so check the federal guidelines to see how much of a deduction you get.
The world of taxes can be a disastrously complicated place, especially once legal actions are taken by the IRS. To help you with all of your freelance tax questions and issues, first contact a professional tax accountant to help file your taxes correctly and then contact a certified tax lawyer if legal issues arise in your tax reporting as a freelancer.
About the Author:
Tax Crisis Institute provides what you need to resolve any collection issues you have with the Internal Revenue Service or any other taxing authority. We can stop them from placing a tax levy on your wages, bank accounts, pensions, and savings. We can prevent them from seizing your house or business. We will give you tax debt help just as we have for thousands of others. We will fight to protect you!
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