Taxes for the Self-Employed: Avoid Common Tax Mistakes and Navigate Freelancer Finances

NerdWallet's Smart Money Podcast

NerdWallet Personal Finance

Business, Education, Investing, How To

4.2 • 665 Ratings

🗓️ 8 February 2024

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

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Summary

Learn about self-employment taxes and avoid common tax mistakes with expert strategies for managing your finances year-round. How do self-employed taxes work? What are some common tax mistakes self-employed people make? And can you really write off payments on a luxury vehicle if you use it for work purposes? Hosts Sean Pyles and Elizabeth Ayoola discuss the intricacies of self-employment taxes and strategies for financial success and IRS compliance to help you understand how to navigate tax season as an independent worker. CPA and financial strategist Krystal Todd joins them to delve further into the details of self-employment taxes, with tips and tricks on budgeting for personal and professional life, the importance of making quarterly tax payments, and whether to DIY taxes or hire a professional. They also discuss strategies like depreciating assets, the benefits of hiring family members and navigating the complexities of tax deductions. Plus: financial strategies for handling unexpected income and managing self-employment taxes, the importance of setting aside funds for unexpected expenses, and the advantages of timing revenue recognition and prepaying expenses for tax benefits. In their conversation, the Nerds discuss: personal finance, self-employment taxes, tax season for the self-employed, quarterly tax payments, financial success, IRS compliance, tax planning, tax deductions, managing finances, budgeting for self-employed, S Corporation benefits, tax mistakes, estimated taxes, IRS payment plans, financial tracking, tax law, Corporate Transparency Act, tax strategies, luxury vehicle tax writeoff, freelancer taxes, gig worker taxes, solo entrepreneur taxes, tax compliance, tax penalties, IRS audit, proactive money management, business growth, cash basis accounting, tax professionals, tax schemes, financial surprises, budgeting tips, bookkeeping tips, and tax planning on an inconsistent income. To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [email protected]. Like what you hear? Please leave us a review and tell a friend. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:19.0	Yes! And it was amazing!
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0:25.3	Prime Video.
0:27.0	Click or tap the banner to find out more.
0:29.8	As Ben Franklin himself said, in this world, nothing a certain except death and taxes.
0:35.7	Taxes, as we all know, can be wildly confusing.
0:39.1	And that goes double when an employer isn't there to help.
0:42.1	We need quarterly payments just of you estimating how much you think you'll be paying in taxes.
0:47.1	And then at the end of the year, when you actually file your taxes,
0:51.0	they'll make adjustments based on, you know, whatever credits and deductions you're
0:54.4	eligible for, what you've already paid, and then you'll see what you met.
1:00.4	Welcome to Nerd Wallet's Smart Money Podcast. I'm Sean Pynes. And I'm Elizabeth Ayola. Today, we
1:06.5	bring you episode two of our nerdy deep dive into self-employment. In our last episode, we talked about the importance of budgeting when you're working for
1:14.5	yourself. Obviously, here at Smart Money, we think it's a good idea for everyone to budget,
1:20.4	but especially if you're self-employed, you're going to need to budget for both your
1:24.5	personal life and your professional life. So in this episode, we're going to answer the most important tax questions self-employed people
	...

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