Although tax season may add to our already busy lives, all is not lost. This time of year can go much more smoothly if you stay organized and make plans in advance for Freelance Tax Deductions. You could even be able to lower your taxable income by being aware of the costs you can write off and using a 1099 tax calculator. The first is that you should keep working with a knowledgeable tax advisor or accountant. They are tax deduction experts who will advise you on what you may and cannot deduct depending on your tax bracket. They may even suggest some further deductions that you hadn’t considered. Then you need to determine if you’re itemizing deductions or taking the standard deduction.
1. Office Room
This is likely the largest deduction you’ll be able to claim as a freelancer who works from home, whether you own or rent. Fill out Line 30 of Form 1040, Schedule C to claim this amount as a deduction. The IRS simplified this procedure in 2010. You are entitled to Freelance Tax Deductions of “$5 per square foot for up to 300 square feet,” according to the IRS.
2. Office Supplies
You can deduct all of your office supplies on line 18, including pens, paper, books, and printer cartridges. When buying office supplies, keep this in mind because you’ll need the receipts to calculate the total.
3. Software and Hardware
What if you work from home using a laptop, PC, smartphone, or tablet? These products, as well as hardware tied to your business, like a camera, may be deducted. If you can show that Netflix and software are necessary for your industry to remain competitive, they can even be removed. You can deduct the business percent if you have a documented record of the hardware and software you use for work. You should confirm with your CPA before submitting an application for Freelance Tax Deductions.
4. Medical Insurance
The IRS added, “If you are self-employed, you should be aware of a frequent tax deduction available to self-employed people.” You may deduct any premiums you’ve paid for health, dental, or long-term care insurance. You could only do this if your own business was profitable. In most circumstances, Line 1 of Schedule A form 1040 can be used to claim the freelance tax deductions.
5. Travel Expenses
Travel expenses including flights, hotels, car rentals, and even dry cleaning may be deductible if you had to go somewhere on business, such as to meet with a client or attend an industry event. If a work trip and a vacation are combined, only the business-related portions of the trip can be claimed.
6. Meals
It’s rather typical to deduct the cost of meals linked to business. The IRS, however, has very tight requirements for meal-based freelance tax deductions. The cost of sending your client to your preferred nearby restaurant for a business lunch might surely be written off. If you send a client to Las Vegas for a weekend getaway, you probably won’t have the same luck.
