Do You Have To Pay Taxes Working As A Freelance Writer?

There are so many benefits of freelance writing as a career or way to supplement your income: you can set your own hours, you can work from anywhere, and you can find variety in work so you’ll never get bored. But there are also some challenges with freelance writing: you’ll have to work harder to manage your time for work-life balance, you’ll have to manage your own scheduling and billing, and you’ll also have to work out your own taxes. Unlike a steady job where you’ll receive one W2 at the end of the year, freelancers must keep track of all of their income and work expenses in order to be able to file your taxes. For many people, this will be brand new. But these tips will help you navigate your first tax season as a freelance writer:

  1. Keep good records
  2. If you use a freelance website to find work and as an intermediate between you and clients, keeping records will be easier, as the website will keep track of a lot of it for you. But, you should also keep your own records, in case of a technical issue with the website. Try to update your records on a regular basis, either every week or every month, depending on how much work you are doing. Records should include the dates, source, and amount of payments, as well as a line item for what the project was.

  3. Put money aside
  4. Because your taxes aren’t being taken out of your paycheck automatically, you’ll need to pay them yourself when you file your taxes. If you don’t plan ahead, this can really catch you off guard. But if you set aside part of each check you receive for work as soon as you deposit it, you’ll be prepared when the time comes to pay taxes. The exact percentage of your income you should save will depend on your total income, but will typically be somewhere between 15-15%.

  5. Track expenses too
  6. Many expenses can be used as deductions for tax purposes if they are directly related to your work. For instance, if you pay a membership fee for a freelance website, you can write it off. So be sure to keep track of expenses too.

  7. Consider using an accountant
  8. Taxes may be more complicated for some kinds of freelancers than others. If you have many different revenue streams, you might consider hiring an accountant, at least for your first tax season as a freelancer.

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