Working as a Freelancer? Here are Common Expenses to Write-Off in Your Taxes
When working as a freelancer, you are required by the IRS to do your own taxes. Hence, you need to keep a record of your earnings for a given period as you will use it in calculating the taxes. 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. Here are common expenses to write-off in your taxes when working as a freelancer.
You can deduct the money you spend on office supplies to calculate your net income. The IRS, therefore, allows you to deduct this expense from your income, lowering your tax burden. It is, therefore, necessary you keep all receipts after you purchase various office supplies. You will therefore have a source of data for determining the cost of office supplies for a given year. Also, you can present the receipts to the IRS in case of a dispute about your tax returns.
You can also deduct the meal expenses when working as a freelancer to reduce the taxes you pay. When you take a business trip, you will take meals, and you are allowed to deduct these expenses on the taxes you pay. 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. You also need to maintain receipts from the restaurant on the meals you consume on a business trip.
Freelancers are also allowed by the IRS to deduct the business insurance expenses from their incomes when calculating the taxes. You may have an office which you have insured against fire when working as a freelancer. Therefore, you can deduct the monthly premiums to reduce the taxes you pay.
When you have understood about the common expenses to write-off in your taxes, it is important you now try out the form 1099. You are supposed to know that there are different types of forms. Every one of them has a way that you are required to fill it. The 1099 form is given to customers who owe you a certain amount of money. The form 1099 is the one that you are required to file your taxes. You should consider finding the best CPA to fill the 1099 form for you.
This post topic: Foods & Culinary