Staying on top of you taxes is an underappreciated aspect of successful self-employed people. Even if your tax professional handles this for you, it's important to know the important tax dates and deadlines for 2017.
If you're a freelancer or own your own business, you may have to pay estimated quarterly taxes as part of the Self-Employment tax. This tax goes toward your Social Security and Medicare. W2 wage earners typically have their portion withheld from their pay automatically. You can pay the IRS online, by phone or by mail.
You can file your annual returns online or through the mail. If you're entitled to a tax refund, you can check for it online. The IRS said it expects to issue 90 percent of refunds within 21 days of filing. It has also said that those who are claiming 2016 tax credits may experience a slight delay on their refunds.
Every taxpayer can benefit from deductions. A deduction, also sometimes called a write-off, lowers your taxable income. The lower your taxable income, the less in taxes you potentially have to pay.
Self-employed workers, freelancers and small business owners can potentially claim many more deductions than W2 workers. Here are some deductions that every self-employed worker should be aware of.
As a W2 employee, your employer would likely cover some portion of your health insurance. Self-employed workers generally have to shoulder those costs themselves.
To potentially help offset this burden, self-employed workers can write off the costs of their health insurance premiums. This also includes dental care, long-term care coverage and insurance plans that cover children up to 26 years old (whether they're dependents or not).
If you use a personal vehicle for business purposes, every mile you drive could be valuable. That's because the IRS lets you deduct 53.5 cents per business miles in 2017. While that may not seem like a lot, just imagine how quickly those miles and savings can add up. That's why the mileage deduction is generally one of the largest write-offs self-employed workers have.* This post is for general information purposes and does not constitute tax advice. Please consult a tax professional before making any tax-related decisions.