Helpful Tax Advice for the Self-Employed
By: Ron Finkelstein

Many professionals have decided to become self-employed since they have such great new technology to help them along. There is the internet and web conference calls that make working for yourself a great idea as a full-time endeavor. Many people are making careers for themselves at home, working the hours they desire and reaping a great income. Being self-employed does have its own set of problems and concerns, one of which is taxes. Read on for 10 tax ideas to help lower taxes for self-employed people:

1. The most important tax tip is to maintain detailed records. Not having big business resources to hire someone to track your records, it is up to you to keep receipts of deductions and to maintain thorough records.

2. Space used for business can be counted as a deduction: If there is some part of your home that you only use for business purposes, for example, a basement office or an extra room being used as an office, you my deduct this percentage of the total space. You may claim this deduction as a percent of your bills such as rent or utility payments. You may also deduct business expenses from a phone bill, if you are using the phone for business calls.

3. Don‘t ignore the cost of doing business. Valid expenses include professional travel, office supplies, shipping fees, professional memberships, subscriptions, and computing equipment. Take care to maintain accurate records of these costs including relevant receipts.

4. Subtract day care costs: There are many deductions that the IRS allows for different types of childcare that are provided during the time you work. It‘s easy to miss this kind of tax information, but it can save you a lot of money. It‘s important to take advantage of the available deductions.

5. Start a Retirement Plan: Think of creating a self-employed retirement plan (SEP IRA) for tax savings and to save money to finance your retirement. You can just start with a small amount like $100 and if you have $2000 or above, consider a Keogh plan option, in which you will be able to keep more money for your retirement plan in the form of tax-deferred savings.

6. If you legally employ relatives, you can deduct medical expenses for the entire family.

7. If you must, defer earnings: When you are self-employed, you are permitted to slightly change your billing so that you can postpone income if you discover you are in a higher tax bracket.

8. Receive a refund from your FICA: You employ yourself, so you are required to submit payment for both the employee and the employer portions of Social Security taxes. You are permitted, however, to deduct one half of these payments when you file a 1040 form.

9. If needed, increase expenses: Just like you may choose to defer your income, should you find that you have a high income that pushes you to the next tax bracket, you may conduct more business purchases at the end of the year to augment some of your tax deductions before the 31st of December.

10. Try to find the right help: While taking help on tax matters go for someone who is an expert on self-employment issues since your requirements may be different from a company‘s needs.

Article Source: http://www.ArticleJoe.com

Ron Finkelstein is NOT a Tax Attorney or an accountant. He is merely a small business owner who has paid a lot of money over the years to learn these www.tax-deductions.info/top-10-tax-tips-for-the-self-employed/“>Tax Tips for the Self-Employed. Check out these other 5 www.tax-deductions.info/5-small-business-tax-deductions-you-dont-want-to-miss/“>Small Business Tax Deductions You Don‘t Want To Miss and more www.consultingmentor.com/“>Consulting Resources

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