Almost a third of the workforce in America is working in the Freelance sector. In 2019, America recorded 57million people working as freelance. We cannot deny the fact that there are some people that are freelancing because they have been laid off but there are still people that love freelancing. The good thing with freelancing is that you have a flexible schedule and that your income isn’t fixed. Nevertheless, with so many positive things about freelancing you should learn that there are challenges that are involved with it. One of the things that challenge freelancers is tax filling. The good news is that filling your freelance tax isn’t a complicated thing to do but an easy one. When you file your business returns you are saving your business and your income too. This page will provide you with five important steps that you need to know when you are filling freelance tax.
Hiring a tax expert is one of the things that you should consider for your tax filing. The different lines of work in freelance can make tax filing a big problem and for that not everybody that can do it. It’s advisable that you hire tax filing services in case you find it complicated for you to do and you can be assured of an excellent job. If you want to know anything about freelance contact us now!
The next thing that you should do is to decide what type of business structure you have. When you are working as a freelancer you can group your business as Sole proprietor, LLCs, or even S- corps among many more than you can see here. the type of business structure you will choose will determine your tax filing. if you want to read more about business structure and tax effects see this homepage.
It’s also good to know your quarterly tax payment estimates. This is very important because it will help you to avoid paying huge tax bills at the end of the year. Since your total tax bill should range from 30 to 35% of your income you should divide that into four parts and you see how much you should pay.
Don’t forget to track your income. Make sure all your income and expenses are recorded and well filed because they are very crucial when it comes to freelance filing. Sometimes tracking your income can be daunting but if you consider checking stubs online for payroll management you will make it easy for you.
Don’t put it off. The worst thing you can do is to procrastinate your tax filing. There are more of our pages that have informative information so make sure to check here!