A Freelancer’s Guide to Taxes

Taxes can be stressful and burdensome for every freelancer. This will help relieve some of the pain.

Justin Cardwell
Dec 8, 2019 · 3 min read
Photo by Brooke Cagle on Unsplash

As you are considered self-employed as a freelancer you get the advantage of tax deductions but also the disadvantage of keeping track of these expenses — proving to the IRS that each deduction is accurate and appropriate.

How much to set aside

What forms to use

You should also receive a 1099-K if you were paid more than $20,000 or more than 200 times, however, if you don’t qualify for a 1099-K, you can use the Schedule C tax form — which serves as an overall tax report for your income and expenses. Schedule C summarizes your 1099 forms into one form, which deducts your expenses from your income. If you had $5,000 or less in expenses, the Schedule C-EZ may be best for you to choose from.

Deductions and expenses freelancers can use

Equipment and supplies

Education and certifications

Meals and travel

Home office

Understand that as a freelancer, you can take more deductions that an employee, however, these deductions must be ordinary and necessary to your freelance operations. Don’t abuse the deductions as any abuse to the tax code can land you in rough waters with the IRS.

By maximizing the tax code for your freelance business, you generate more profit for the year by being methodical and organized. It’s difficult to see yourself as a business, however, the IRS classifies you as self-employed operating as a freelancer. Take advantage of that fact.

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Justin Cardwell

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I sit around all day drinking coffee writing about business and finance. I couldn't ask for a better life if I tried.

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