Freelance + Do own taxes = ?

Bigjohn

Thought maybe someone here went down this path. I'm freelancing, and I don't want to pay someone to do my taxes (I'm in the US btw). I figured it can't be that complicated to do on my own. Does anyone here do this? Or am I crazy for thinking about that?

I know there are programs like Quicken/Quickbooks and whatnot. Anyone have any experience with those?

MikeF

The first year i did full time freelancing i did my own and it worked out fine, but then the next year i went and saw an accountant and he saved me about 3k in various benefits and credits that i would have spent hours trying to find (if at all). Depending on who you go with it can be a little expensive, but do some looking around and you can have it done rite for a few hundred.

I really hate the administrative side of running your own show, but if you've got someone helping you in that department it'l save a ton of time, headaches and money

Gav

Get an accountant, if you're serious. I've done both, had no issues with both, but the accountant has a ton of knowledge that can help you, protect you, and open up opportunities for you. Plus, the time you save not worrying about it, you can focus on art and managing clients - not dodging the government

Bigjohn

I have an accountant right now that's being handling my family for years. But it doesn't seem like he knows much about freelancing or working as an artist. I thought it'd be easier doing it myself. But maybe there are accountants that are more aware of the entertainment industry. You guys aware of any in the LA area?

Damien_B

Just do it yourself via turbo tax. I think its free until you get to the last step, which is payment for services. I wrote off rent, computers, software, travel time, and motels, and was never asked for receipts from uncle sam. However, one time when I did a 1099 myself they (uncle sam) got back to me with a revision they calculated themselves. I could have legally disputed it, but I was still in the green, so I took the cash and ran.

Lamont

I used someone out of town when I was in SoCal (she is in Texas) and she did a great job. Saved me a ton of cash. She dug and got as much as she could. If they are having problems dealing with someone who is self employed(aka freelancing), move on. Good luck in finding a CPA, good ones are hard to find.

Lamont

Damien_B wrote: »

Just do it yourself via turbo tax. ::SNIP::I wrote off rent, computers, software, travel time, and motels, and was never asked for receipts from uncle sam.

If it is too big or raises flags, they will audit you. Won't be this year, maybe not next... but it will happen. You really have to be careful.

MM

get an accountant. any decent accountant should have good experience with self-employed personal tax. if all you are doing is full freelance then thats all it is. freelance artists' tax isnt any different for other self-exployed. if the accountant doesnt have experience with schedule C(usually for self-employed) then dont use him/her. using legit accountant from an established company = less risk, less headache, usually more savings on your end.

as for cost, on average it should be around $100-150. you do it once a year and that = $10 roughly per month. i refuse to believe you cant spare $10 a month on tax.

skip a beer or two....

Ferg

I used HR Block when I was freelancing, the quality can vary from agent to agent, but overall it was well worth the money (usually in MM's cost range, as long as you're not doing anything weird).

spiderDude

If you make less than $57,000 anually, you can go see an IRS agent in person to file your taxes for free. I've heard they do pretty good job at it, I'll be going that route for the coming tax filing.

almighty_gir

MM wrote: »

get an accountant. any decent accountant should have good experience with self-employed personal tax. if all you are doing is full freelance then thats all it is. freelance artists' tax isnt any different for other self-exployed. if the accountant doesnt have experience with schedule C(usually for self-employed) then dont use him/her. using legit accountant from an established company = less risk, less headache, usually more savings on your end.

as for cost, on average it should be around $100-150. you do it once a year and that = $10 roughly per month. i refuse to believe you cant spare $10 a month on tax.

skip a beer or two....

for reals?

the accountants around where i live are like £700 per year.

firestarter

almighty_gir wrote: »

for reals?

the accountants around where i live are like £700 per year.

There's a big difference in how things are done, literally everyone that works in NA have to file taxes independently, where as the UK as you know it's just the self-employed/owners that need to do that. It used to be the case that a decent accountant could do some magic and get your rate down to around 5%. I had a friend, a small business owner that regularly got away with 3%... however I seem to recall a lot of those holes got closed up, so UK accountants probably are ripping people off riding on the wave of yesterday. I'm assuming that last bit obviously =]

almighty_gir

i dunno, i file all my own because the accountant costs so much haha. i keep ridiculous records, digital and physical of all incoming and outgoing finances. personally i don't find it that big of a headache. each evening if i've got any expenses for my business i fill them into my excel spreadsheet with the date and a little note saying roughly what it is, and file the physical receipt away in a dated file.

then when it comes to send off my actual tax report, all of my income is already calculated and i just put numbers on the tax form. simples!

i'm also quite proud of being someone who doesn't dodge taxes. it makes me feel good to pay my fair share.

Bigjohn

Hey one more question for you freelancers. Do you have a separate business account for all freelance-related stuff, or do you still use your personal checking account?

I mean an account where you deposit checks and charge business expenses to.

EarthQuake

No, but I do have a separate account where I save a certain % of all income earned for tax purposes, which I deduct from and pay quarterly. I use a capitol one 360 (formerly ING orange) online savings account, which has a better interest rate than any bank that I know of. Its nice to keep it entirely separate to keep yourself feeling like its money you actually own.

If you have trouble budgeting your cash its a good idea to keep everything in a separate account and "pay" yourself some sort of reasonable monthly wage. This can be very helpful if you have irregular work.

Its also a good idea to have a separate credit card so its easier to keep track of any business expenses. I should probably do this but I'm too lazy hehe.

Bigjohn

Yeah, a separate credit card is what I'm also wondering about. Just using your regular one doesn't cause any problems with separating business expenses from regular expenses?

Blaizer

Same as EQ but with separate accounts (one for pounds, euros and another for dollars).

I also do all the paperwork/taxes, i don't need a "crook" charging me money, because for me is like gift him easy money. I'm not a poor wishy washy. Some people say they have too much work like to be worrying about papers, but at the end, the paperwork is not a hassle as some guys may think. Those are just flojos, lazy-asses in my opinion.