If you’re self-employed, filing your income taxes can present a significant challenge.
Not only are the tax laws applicable to self-employment confusing and onerous, but you already struggle to find time for all the obligations you have before you. Owning and running a business – even if you’re working alone as an independent contractor – is incredibly taxing on your physical, mental and emotional health.
Instead of taking a risk with a software program or do-it-yourself tax filing site, seek tax help from a qualified CPA who truly understands how to help you reduce your deductions and make the process as simple and cost-effective as possible.
WHY TAXES ARE CHALLENGING FOR THE SELF-EMPLOYED
The two most pressing tax-related challenges that self-employed people experience are a lack of time and a lack of familiarity with the tax codes.
No business owner or freelancer has time to become an expert in the complex federal or state tax laws – which are constantly changing. But, unless you truly understand how the tax code works and how to leverage the laws to your best advantage, you’re likely overpaying your taxes. You also run the risk of making mistakes and underpaying your taxes, which can result in costly penalties and interest – or even trigger an audit.
You face the same risks when you use software programs or short-cut services for filing your taxes.
SPECIAL CONSIDERATIONS WHEN FILING TAXES AS A SELF-EMPLOYED PERSON
The first issue that you face as a business owner, freelancer or other self-employed person is the need to file quarterly taxes. This requirement exists for anyone who does not have income taxes withheld from their paycheck.
You must also consider what items you are allowed to use as deductions. For example, if you run a business from your home, you may be eligible to deduct a portion of your mortgage and utility bills. Determining exactly how much you can deduct – and whether you are indeed eligible to take this and other deductions – can be a complex endeavor.
Depending on the type of business you engage in, you may also have industry-specific requirements and eligible deductions, especially if you maintain any type of physical inventory.
Finally, the amount you contribute to a retirement plan can greatly influence your tax liability. Self-employed persons are allowed to contribute more than employees. But, as with the other issues we’ve addressed, the rules are convoluted and potentially confusing.
CHOOSING A CPA TO ASSIST YOU WITH TAX PLANNING & FILING
Finding a self-employment tax expert to assist you is the key to minimizing your tax liability and remaining in compliance with all applicable laws. A self-employed CPA knows the right forms to use and how to ensure you take every dollar of deduction to which you are entitled.
When you trust Cash Flow Mastered for self-employed tax help, you will have Utah’s premier CPAs at your service. Our tax planning services are designed to maximize your deductions and simply the process as much as possible. We offer a first assessment at no cost to you. What do you have to lose? Contact us today to schedule your free self-employed tax assessment.
