More people are going freelance than ever, but that means paying more taxes. Don’t miss out on these 5 Self-Employed Deductions You Can’t Afford to Forget.
Are you self employed and preparing to file your 2018 income tax statements?
If so, you aren’t alone. There are more than 16 million self employed people in the United States! Being self employed has many perks, including being your boss and often keeping your hours.
When it comes to tax time though, there are also other benefits to being self employed that you can’t afford to forget.
Read on to learn about five great self employed deductions for your income taxes!
- Office Supplies
Many of your tax deductions as a self employed person are filed using Form 1040, Schedule C.
The money you spend on office supplies for your business can be deducted from your income taxes to help reduce your tax liability for the year. This includes things such as pens, paper, ink cartridges, binders, and more.
You need to keep your receipts for business expenses so that you can tally up your total costs for this valuable deduction.
- Travel Expenses
Does your line of work bring you on the road regularly? Whether you are on the road each day or only once in a while, you can deduct these expenses from your taxable income.
For example, when you attend a conference or industry event, keep those receipts. You can deduct things such as your flight and hotel costs, as well as the price to attend the conference altogether!
- Internet and Phone Bills
In today’s digital age, there’s a good chance that your business has some level of expense for the internet and phone.
Whether you have a landline or a cell phone, you can deduct these expenses on your Form 1040. Are you concerned that you use your cell phone for both business and personal reasons?
If that’s the case, the tax law allows you to deduct the amount for the percent of the time you use the phone (or internet) for business purposes.
Be sure to keep track of your time and total expenses so that you can include accurate information on your taxes.
- Legal/Professional Services
Sometimes your work will require you to use the service of a lawyer or other professional.
When you hire an attorney or professional consultant, hold on to their bills so that you can provide this information to the IRS on your taxes.
This information is included on Line 17 of Form 1040, Schedule C. You can even deduct the cost to hire a CPA or accountant to prepare your tax return!
You can also include the expenses you’ve had for paying a company like paystubcreator.net to prepare payroll for your employees!
- Office Space Costs
Your office space may be the most costly expense that you are eligible to deduct on your income taxes.
Whether you are working from home, and regardless of whether you own or rent, you can deduct a percentage of those costs as a freelancer.
Wrapping Up: The Best Self Employed Deductions
Self employed deductions are an important way for you to reduce your tax liability as a freelancer or small business owner.
Since many tax laws change each year, you should stay on top of these revisions and speak to a trained professional about what’s best for your situation.
Are you interested in learning other ways to be financially savvy as a business owner and at home?
Check out our blog posts to learn tips and tricks to help you improve your money sense!