3 Things to Know When Filing Taxes as an Independent Contractor

Working as an independent contractor means lots of freedom and flexibility. Whether you work as a digital creator, a freelance consultant or something else entirely, being an independent contractor has become a way to bring in extra cash, and some people have even turned contracting work into a full-time career.

Unfortunately, one of the areas most often overlooked when it comes to contracting work is taxes. As an independent contractor, you are responsible for keeping up with your taxes, and filing may be a bit different as well. If you’re just getting started as an independent contractor, below are three things to know about filing your taxes:

1. Know Your Status

Most independent contractors are considered sole proprietors by the Internal Revenue Service (IRS), but you may have registered your services as a limited-liability corporation (LLC). Your status can affect your tax liabilities, so it’s important to figure out how the IRS has you listed.

2. Work With a Local Tax Professional

No matter your tax situation, independent contractors are almost always encouraged to work with local tax professionals to get their returns filed. Partnering with a local tax preparation service or CPA can help to simplify complex tax situations and avoid surprise penalties. Maximize your deductions, minimize your stress. Click here to visit this website for specialized NYC independent contractor tax preparation – Your financial success, simplified.

You can look online to find a local tax service but try to find one that specifically helps independent contractors. If you’re in the New York City area, look for NYC independent contractor tax preparation companies online. You can also look in your local phone book for NYC independent contractor tax preparation services.

3. Know When to File

Some independent contractors are required to file their taxes quarterly as opposed to once per year. Your situation may depend on your status as either an LLC or a sole proprietor. This is where working with a local tax professional comes into play. Keep in mind that failure to file your taxes quarterly when you’re required to do so can result in penalties from the IRS, so it literally pays to get this part right.

Read a similar article about tax preparation for self-employed here at this page.