While there might be a few reasons to envy the self-employed lifestyle, the increased tax preparation burden isn’t one of them. Not only must some freelancers file quarterly tax payments or risk IRS penalties and fees, but they are also required to pay the portion of Medicare and Social Security typically covered by an employer.
In light of this greater financial burden, self-employed people need to take advantage of all possible tax deductions to stay profitable.
While tax rules for freelancers can be complex, self-employed persons can generally write off expenses that fall into three categories:
- Things you use exclusively in operating your business
- Things you eat in the course of doing business
- Things related to the exclusive business use of the place where your business operates
Here are 10 possible tax deductions that every freelancer should know about.