Tax Tips

Tax Tips For Freelancers

Freelancing has many benefits, including working from home, working on your own schedule, and getting paid the full amount that you make. This can also be a downside, though, because tax isn’t automatically withheld or taken from your paycheck, which can get you into trouble when tax day draws closer, if you aren’t careful. Here are a few tax help tips for freelancers to help you avoid a situation where you need a tax attorney to find you tax relief

  1. First and foremost, make sure you consult a tax attorney or accountant to determine how much you should be withholding from your pay on a monthly basis so that you don’t have to suddenly come up with your entire tax bill when it is due. This is the biggest key to tax success as a freelancer.
  2. If you have a home office, you are eligible for a home office deduction. The IRS does scrutinize these deductions more than others, so make sure your office is in a completely separate room or area of your house and is the principal place where you do business.
  3. If your business is a one-person venture, make sure you report your income and expenses on Schedule C. This means your expenses directly offset income, you will be paying self-employment tax if you make more than $400 in net profit, and you can show a profit for three out of the past five years.
  4. If you are paying COBRA premiums, but you aren’t working, make sure you track your out-of-pocket medical expenses to see if you are eligible for a medical expense deduction, come tax time. 

Contact Levy & Associates for Dependable Tax Audit Services

Levy & Associates is available for free initial consultations. We’re happy to answer any questions you have about the audit process or address any concerns about your specific situation.

There’s never a good time to be audited, and the time-consuming process will take away from your business or family if you try to face it alone. Let us handle and coordinate communication, so you can return to your daily life.