Tax FAQS For Freelancers

Freelance Tax FAQ helps you get all your questions about being freelance answered.

Is my health insurance considered a deductible expense?

Most definitely, especially if you are one of the millions of self employed hustlers, freelancers, digital nomads and sole proprietors that have to pay for Insurance yourself then the IRS absolutely want you to know about this deduction! The Health Insurance Deduction is generally available to you and for your spouse and dependents, so please take note!

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Can I deduct my home office for taxes?

You absolutely can deduct a portion of your home office for taxes!

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How do I calculate my home office deduction?

The most important first step in being able to calculate your home office deductions is record keeping!! Keeping all your records for your business home expenses is very important as you need to allocate the expenses of operating your home between business and personal use.

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Can I deduct mileage?

Of Course, if you use your car in your business, you can deduct car expenses and you may deduct its entire cost of operations!!

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Can I deduct meals?

You Betchya! Although you can't just claim all meals!!

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How do I calculate mileage as a business expense?

It is important to keep a small notebook in your car or use a mileage tracking app to track mileage, travel to clients, customers, business meetings, traveling to a temporary workplace.

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What is self employment tax?

If you are self employed, freelancer, independent worker then you best get ready to pay the self employment tax.

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When do I pay quarterly taxes?

To calculate your federal quarterly estimated tax payments, you must estimate your adjusted gross income, taxable income, taxes, deductions, and credits for the calendar year 2017.  Form 1040-ES includes an Estimated Tax Worksheet to help you calculate your federal estimated tax payments.

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Do I have to pay quarterly taxes? Is there a penalty not to?

If you didn’t pay enough tax throughout the year, either through withholding or by making estimated tax payments, unfortunately you may have to pay a penalty for underpayment of estimated tax.

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Do I fill out/send 1099s or do my clients?

Your clients should complete and send you all of their 1099s for the year by the end of January. However, if they do not you are still responsible for reporting your income to the IRS!

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When does a 1099 need to be filled out?

Basically the rule is that you must file a 1099-MISC whenever you pay an unincorporated independent contractor-that is, an independent contractor who is a sole proprietor or member of a partnership or LLC-$600 or more in a year for work done in the course of your trade or business.

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What are deductible expenses?

Deductible Business expenses are the cost of running and operating a business. These expenses are generally deductible if the business operates to make a profit.

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