Have you earned more than $5,000 as a freelancer this year? If so you’ll probably end up owing more than $1,000 in taxes, which means that the IRS will expect you to pay “estimated taxes” 4 times a year. As an Independent Contractor you receive your earnings without paying any tax. Employees pay taxes every paycheck through withholding so although this may seem unfair it actually means you’re paying taxes less frequently than the average American (head over to our post on Understanding Your Taxes as a Freelancer to learn more). Although that’s certainly nice, calculating and keeping up with Estimated taxes Payment can be a real pain. You can find the latest guidelines from the IRS here.
Are you a recent Uber, Lyft, Instacart, Doordash or Postmates Independent Contractor? Maybe you recently set out to be your own boss as an independent photographer, wedding planner, designer, musician, handyman, or real estate agent? Well whether you think of yourself as an freelancer, Independent Contractor, Self Employed, or Solopreneuer taxes are something you’re going to have to deal with and important to understand your taxes as a freelancer.