Considering that the coffeeshop office is so popular in Brooklyn that even bars have gotten into the wifi game to woo the self-employed, it should come as no surprise that our borough has the largest population of freelancers in the city. But guess what, all you 1099-using graphic designers, bloggers, journalists and independent contractors galore? You still have to pay taxes, lest the wrath of the Internal Revenue Service befall you.
If you were lucky enough to get paid for your services rendered last year, but were hired as a freelancer, your taxes were likely not withheld, and you’ll owe a bundle of cash come April 15th. It’s pretty depressing to have to pay out a quarter or so of your earnings, especially if you haven’t been keeping track, plus freelancers pay twice the social security and medicare taxes everyone else does since we don’t have employers to cover the extra costs. But as teeth-grindingly awful as Tax Day may be, it’s even worse to have the IRS on your tail. According to the Daily News, one-in-three freelancers are behind on their taxes and end up owing an even bigger bundle of money over time.
But before you start asking your freelance bosses to pay in cash, list every beer you’ve bought as a deduction because work made you tired or start researching tax havens in the Cayman Islands, talk to an accountant about ways to keep your tax costs down: plenty of places in Brooklyn offer free or cheap tax prep for freelancers, and look forward to all those Tax Day freebies once you’ve filed.
[h/t New York Daily News]
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And for the love of God, file quarterly if you make all or most of your wages from freelancing!