April 15 has come and gone. Take a deep breath – you did it! You filed your taxes, paid Uncle Sam, and are free for another 12 months to go along your merry freelance way.
Or…instead of shoving the frustration of taxes into a dark metaphorical corner until next March, now is the perfect time to review your finances, plan for next year, and ultimately come out on top instead of majorly stressed.
If you’re like many freelancers, tax season is a whirlwind of emotions, gathering random 1099s from clients across the world, and worrying that you haven’t done everything you could to get your full refund.
It doesn’t have to be this way! With a little reflection each April, each year can be easier than the last. Eventually, tax season is a breeze without unexpected payments to “the man”.
Before we get started: I am not an accountant or a professional financial adviser, and this is not financial advice from me or from Such A Voice. Please take this information as my personal experience and not step-by-step instructions for what to do in your specific situation. Consult an accountant before filing your own taxes. Caveat complete.
Ok, so how do you get to the magical goal of an easy breezy tax season?
These three simple steps:
- Pay Quarterly. It took me years to take this advice from other freelancers. The sooner you start to pay quarterly estimated taxes, the easier each April becomes. Based on your most recent tax return, you start to pay taxes every three months ahead of time, instead of waiting until the end of March for a big bill. The best part? You can do this online. Plus, if you overestimate and pay too much, you have two options: receive a bigger refund, or put the surplus toward the next year’s taxes.
- Track Mileage. While many voice-over artists work exclusively at home, there are some things that take us out of our dark recording studios into the real world. If you’re out and about in the community, chances are you can deduct your mileage. Plus, these days it’s much easier than having to record mileage by hand and note your odometer readings. You guessed it: there’s an app for that! Personally, I like MileIQ. Keep in mind that you can’t deduct every mile you drive. There are a few rules to follow.
- Invest in Accounting. The final element of an easy breezy tax season? Not doing it alone. Freelancer taxes are not simple – there’s no reason you should navigate it without professional help. I’ve found it’s much more efficient to set aside the money to pay an accountant than to try to navigate it on my own. But, investing in accounting is more than just hiring a tax professional once a year. Your business needs organized finances to give an accountant the right information come tax season. There are a few services that consistently rank highly among freelancers. And guess what? You can deduct whatever you spend on accounting services from next year’s taxes!
With these three adjustments in mind, next April will be easier than ever. So, what’s your next step? Get this year’s tax return and start paying quarterly today.
What helps you ease the burden of tax season? Let us know in the comments below!
Caroline Turner Cole is a voice-over artist, writer, yogi, and coach based in Dallas, TX. Connect via Instagram @carolinecolestories.
