A Freelancers Guide to Taxes
There are numerous advantages that subcontract workers and sole proprietors enjoy while using their respective abilities and creative talents. Whether they are writing, managing, or simply following a blueprint established by others, these valuable members of the workforce gladly take advantage of their flexibility of schedules, ability to work from home, and control their own workplaces, just to name a few.
However, when tax season arrives, freelancers usually face more challenges than their full-time colleagues. They must pay attention to all the tax rules and regulations in order to avoid penalties at some point in the future.
Frisco Bookkeeping and Tax Services is available to provide valuable assistance to freelancers and sole proprietors as they prepare their tax information. In the meantime, we are pleased to provide you with several helpful hints to consider.
Keep track of all income & expenses
This approach begins well before the tax season. In fact, you are strongly encouraged to plan ahead by organizing all pertinent information from Day One of obtaining a client. Be sure to keep a file of all invoices and deposits of the exact amount of money that you’ve earned annually. Safely keep all receipts and related data, particularly your records of business expenses.
We also recommend that you set aside a certain percentage of your earned income to account for your taxes. Subcontractors are required to report amounts in excess of $600 each year.
Don’t hesitate to obtain help
This is where Frisco Bookkeeping and Tax Services (FBTS) can play a key, successful role in helping you report and pay taxes as a freelance worker or sole proprietor, which can be tricky business. For one thing, a tax professional will have a greater understanding of tax laws and regulations that you may not have even considered – this will help you avoid being penalized by the IRS. This tax professional will advise you about which expenses should be written off to increase your tax return.
Paying monthly, quarterly vs. yearly taxes
As a self employed subcontractor, you have the option to pay taxes monthly, quarterly or annually. If you are a sole proprietor who makes a sizable income, we recommend paying estimated taxes monthly and to avoid penalties you need to pay in what you did the previous year.
Write off some expenses
An enormous advantage of working remotely is the menu of write-offs you are eligible for. Possible deductions include office space, technology, supplies, donations, and travel costs.
Frisco Bookkeeping and Tax Services provides a variety of services for individual and small-to-large companies. Our firm, which boasts more than 20 years of successful, timely and reliable assistance, offers setup and training of Desktop Quickbooks, Online Quickbooks or any accounting program you may use. We also help incorporate other software used with QuickBooks and help train to use both softwares together. Such as Ipoint, T-Sheets, D Tools, ADP, Paychex, BTGusto, CRM programs and so many more, this is just to name a few.
FBTS is owned by Jennifer Marcus, who has earned a master’s degree in Accounting and Financial Management. She is also a
CTEC Registered Tax Preparer and is a QuickBooks® ProAdvisor.
Please feel free to contact our office via E-mail at jennifer@friscobookkeepingandtaxservices.com or by phone at (972) 885-0156. Please visit our website at www.friscobookkeepingandtaxservices.com.
We focus on all industries but have many clients in Audio Visual & Technology, Dentistry, Property Management, Rentals, and Property Investments, Property Restoration and Selling of the residential or commercial property, Construction, Commercial cleaning and restoration, repair, Commercial Real Estate, Advertising, Media Communications.