Does It Matter What You Call Yourself?
Before we roll up our sleeves and get to the definitions, let’s take a moment to address the elephant in the room: Do you really need to know what to refer to yourself as? Does it really carry any weight?
While you probably won’t have a policeman knocking on your front door if you refer to yourself as an entrepreneur as opposed to a freelancer, finding the right label that fits your career or business is still important.
Why? The biggest reason is that it has certain implications for how you’re perceived by your clients and customers. Calling yourself a freelancer, for example, sends the message that you’re available for hire and for a variety of different projects. A solopreneur, however? Prospective clients might assume that you’re doing your own thing—meaning you aren’t available for their work.
Another big concern is whether or not the category you fall in will have an impact on the taxes you pay. However, that’s actually not as critical as you might think.
Whether you’re self-employed, a freelancer, a solopreneur, or a business owner, you’ll be required to pay self-employment tax. You will also likely file out 1099 tax forms to report your income.
The only tax difference you might face is if you’re a business owner with things like employees and a storefront. In that situation, you’ll have other tax matters to attend to than someone who truly works solo.
So, now that you know the importance of finding the right descriptor for yourself, let’s figure out what each of these terms actually means.