Tax time is right around the corner, and if you’re anything like us, you’re still trying to assemble your paperwork and get your financial house in order to make this year’s freelance tax filing ordeal work as painlessly (hah) as possible. That’s why we direct you to the most important source of wisdom for 2009 taxes ever--the IRS official site itself.
Freelancers, do not be afraid to learn the arcane rules governing self-employed filers. Husband and wife freelance teams, do you know whether you must file as a partnership or as a sole proprietorship? What about knowing the difference between an employee and an independent contractor?
The IRS small business/self-employed FAQ section answers these questions and many more. If you’re still scratching your head over issues such as your limits for deductible meals during business travel such as your travel writing trips or a weekend outing for a writing conference, this site is definitely one you need to know well.
The IRS has a reputation for being mysterious, unreasonable, and downright Byzantine in its rules and regulations that govern our work; I suggest that it’s a simple lack of knowledge in some cases that trips up the up and coming freelancer. It’s not so hard to grasp, for example, that you can create a small company without a tax ID number—if you have no employees, excise or pension plan tax returns, you can use your Social Security number instead. It’s there in black and white, all you have to do is look it up. And that’s the way much of the information for self-employed people is presented on the IRS official site–simple English.
Don’t be intimidated by what you think you know about the IRS. Read the rules for yourself and then decide if you still need to pay a tax pro to help sort you out. You might be surprised at how quickly you grasp some of the finer points. Don’t hesitate to go to the tax professionals if you feel in over your head–but at least give yourself a chance to become familiar with the rules first.