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  • This is Victoria from TurboTax. The rules for self-employed taxpayers can be complicated.

  • But there's no need to worry as long as you follow some basic rules from the IRS.

  • First, since you are no longer an employee, you'll need to pay your own income and Social

  • Security taxes. Most taxpayers with self-employment income make quarterly estimated tax payments

  • based on the amount of income the business earns.

  • Self-employed taxpayers also need to pay self-employment Social Security and Medicare taxes by filing

  • Schedule SE with their tax return. The rate is 15.3% of your self-employment

  • earnings. But you get to deduct half of those taxes on your 1040 as an adjustment to income.

  • At tax time, you'll need to file Schedule C to declare your income from your self-employment

  • wages. The good news is you can also use Schedule

  • C to list your deductible expenses for things such as advertising, insurance, employee wages

  • and equipment you purchased to do your work. Most people are cash-basis taxpayers so expenses

  • are deductible in the year you pay them and income counts in the year that you receive

  • it. If you have a home office that you use exclusively

  • for your business, things like making appointments and billing customers might also be eligible

  • for a home office deduction. You can also deduct expenses for cars or trucks

  • you use to transport your equipment and to travel from job to job. TurboTax will help

  • you choose between the standard mileage rate or deducting your actual expenses for things

  • such as gas, oil, insurance and repairs. TurboTax will help you figure out what you

  • owe, what expenses you can deduct and help you file all the right forms.

  • For more information on the tax rules for being self-employed, visit Turbotax.com.

This is Victoria from TurboTax. The rules for self-employed taxpayers can be complicated.

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Tax Tips for the Self-Employed - TurboTax Tax Tip Video

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    林宜悉 posted on 2020/02/25
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