The IRS considers freelancers to be self-employed and requires them to do their own taxes. It is therefore up to you to calculate your income for the years and determine the taxes you will pay. For many freelancers filling the taxes is a complex process that they struggle to follow- To overcome this obstacle, it is smart you seek the help of the best tax consultant near you. With the help of this tax consultant, you will abide by the regulations set by the IRS for freelancers. You will therefore avoid penalties from the IRS when you hire the best personal CPA near you. Read more now to see the expenses that are tax-deductible when you are a freelancer.
The money you spend on office supplies is a business expense that lowers income. Thus, you can subtract the office supplies from your income when calculating your taxes as a freelancer. Hence, make it a habit to file all the receipts you sell from the office supplies vendors. The goal is to have a record to use when calculating the total office supplies expenses for the year. The receipts can also serve as evidence when you have a dispute with IRS on the taxes you are supposed to pay for the year.
The other common expense that you are allowed to be tax deductible when you are a freelancer is meal expenses. However, it is not all meal expenses but only the ones you consume when on a business trip. You, however, need to know that the meal expenses must be reasonable. Therefore, you cannot take advantage of this tax write off to take super expensive meals when on a business trip. Ensure you keep the receipt for the meals you deduct the expenses from the taxes you pay.
You will also enjoy business insurance expenses write off on your taxes when you are working as a freelancer. Maybe you have insured your business car or building. Therefore, you can deduct the monthly premiums to reduce the taxes you pay.
form 1099 is another thing you should keep in mind once you know about the common expenses to write-off in your taxes. You are supposed to know that there are different types of forms. You are required to know the ways in which you are supposed to fill out each form. You are also required to know the person who you are to give the 1099 form. You should know that the places that are appropriate for you to fill the taxes are in the form 1099. When you are filling out this form 1099, you might be confused on how to go about it, and by this, you are supposed to hire a CPA.