Seven months ago, I quit my day job and started freelancing full time. Although it was scary at first and I’m still adapting, I’ve been feeling pretty positive about my career in the past couple of weeks. However, when I realized it was time to do my taxes, the bubble burst. While some people told me I needed to do certain things in order to stay on top of the tax situation, I heard them like Charlie Brown hears adults, as a general mwa-mwa-mwa background noise. Working as a freelancer means that I get to set my own schedule, but it also means I have to deal with a different set of problems. None of the companies I work for take taxes out of my paychecks. Now I’m coming to terms with the big chunk of change I owe the government and am finally doing my homework. Here’s what I wish someone had told me back in August—the tax rules every freelancer should know.
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Are you a freelancer? What’s your plan for dealing with taxes?