Unless you’re an accountant, keeping up with the U.S. tax code is a challenge. Our country’s complex and ever-changing tax laws keep the folks at Turbo Tax and H&R Block in business. Organizing your records and slogging through each line on the federal 1040 isn’t anyone’s idea of a good time; but tax time is even more complicated for people who operate a business from their home.
While the government offers some helpful tax advantages to home business owners, some filing requirements may surprise self-employed at-home workers. On the plus side, you may be able to deduct a portion of your rent/mortgage and utilities as a home office expense. On the minus side, it is likely that you’ll be required to start paying social security taxes on your home-business income. If you do not already, you may also need to start filing quarterly estimated taxes to offset next year’s tax bill.
If you have recently started a home-based business or are operating a home business on Zoondy, there are a number of helpful websites that offer practical information on self-employment tax requirements and tax planning.
- Internal Revenue Service Self-Employment Tax Center. Start your search on the federal tax site where you’ll find tax forms and explanatory publications. In an effort to be more user-friendly, the IRS now offers helpful videos, webinars and workshops for small businesses and self-employed individuals on a variety of topics, including non-tax topics such as retirement planning and record keeping. If this is your first year as an at-home worker, you’ll find good info about self-employment and starting a business on this site. Click on the Affordable Care Act link to find out how new health insurance laws will affect your tax picture as an at-home worker.
- National Association for the Self-Employed offers a wide variety of valuable resources for people who work at home. NASE’s Tax Center offers helpful tutorials on common tax questions, highlights new changes to the tax laws affecting self-employed workers and gives you a head’s up on what’s coming.
To be continued
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