Lion's ROAR Marketing

Let Uncle Sam Work For You: Freelance Tips for Every Tax Season

It has been a month today since the end of tax season.  For some Americans it was a time of joy.  For others it was a mini heart attack moment.  I have to say it was a little bit of both for me.  By only entering information for my white-collar job I saw that Uncle Sam was coming after me.   But then while my Mom and I were working on my taxes we realized, “Hey, don’t I have a start-up I could claim taxes on too?!”

The concept didn’t really dawn on me since I’m not exactly a Fortune 500 Company (heck even a Fortune 50,000 company).  But the fact is that I invest a lot in making sure my little dog and pony show runs like a well-oiled machine.

Now being a combination of a procrastinator/newbie entrepreneur/scatter brained, I didn’t prepare myself as much as I should for the freelance component of my tax season.  This provided for a full-on, hands-on learning experience.  Therefore, here are some tips and lessons learned from reporting to the IRS and State Government about my freelance expenses:

Sigh of relief.
  • Use Turbo Tax.  If you barely passed Accounting in college, then Turbo Tax is for you since they call out the important items you can claim and what you shouldn’t even bother with.  I used the Deluxe Version for $49.95 which helps you go into more detail by asking about freelance business endeavors.
  • While you are accruing expenses and revenue, make life easy on yourself and document everything in Google Docs.  Another great chance to utilize Google Docs for freelance management.
  • Keep your receipts.  This is obvious but you want to make sure you have the documentation to support your tax claims if it comes down to it.
  • Realize you can claim certain office expenses like: Internet, Utilities, Cable, Cell Phone, Gas, Laptop, and Vehicle.
  • Make sure you have applied for an Employee Identification Number (EIN).  Turbo Tax requests this for particular expenses you want to claim and it makes life a lot easier.  I applied for one awhile back.  Read my post on how easy it is.
  • Carry a book/log in both your bag and car to write down any notes about expenses accrued unexpectedly (tolls, mileage for meetings, locations, dates and times).
  • A no brainer but be vigilant, meticulous and anticipate tax season all year long.
The Good, The Bad and The Ugly (not necessarily in that order).

One never knows what Uncle Sam will give or take from you in the calendar year.  That’s why protecting yourself is crucial to making sure Big Brother doesn’t have a reason to pay you a visit.  Realizing the government acknowledges your efforts to stimulate the economy by creating your own business is a great feeling.  Appreciate this privilege freelancers and the like have and take advantage of it.  If you have any other tips I missed please drop a comment.  Let your ROAR be heard!