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Wednesday, June 08, 2016

10 Things to Prepare for Your Accountant as a Freelancer

By Megan King

10 Things to Prepare for Your Accountant as a Freelancer

Taxes can be frightening for freelancers. Here are 10 things that freelancers should be preparing for their accountant before tax season.

1. Basic Information

This is an obvious one, but make sure to have all your ducks in a row by gathering up your business information before tax time rolls around. That would include your: Social Security Number or Tax ID Number for your business, business name, business address, QuickBooks reports or any other accounting software that tracks your expenses. The more you're organized, the faster your accountant will be.

2. Quarterly Payments

As a freelancer, you should be paying quarterly estimated tax payments for federal and state taxes. Make sure to meet with your accountant and discuss whether you should be adjusting your payments for next year. Also, discuss with your accountant as to the best amount and time to send your payments.

3. Mileage

Don't forget to track all your mileage for your business trips and errands. Your accountant will take this into account.

4. Create 1099s

If you hired others (ie. sub-contractors), you need to notify your accountant to create 1099s. Some accountants don't do this so make sure that you're prepared in advance. Things to track for your 1099s, 1) Name of Sub-Contractor, 2) Tax ID or SSN, 3) Amount paid during that tax year.

5. Extra Business Profits/Debts

Make sure that your accountant is aware of any extra business profits or expenses that is not included on your Quickbooks report or spreadsheet.

6. Received 1099s

Other companies that hired you as a sub-contractor will send you a 1099 as well. Include this within your paperwork for your accountant.

7. LLC?

If you are an LLC, make sure that your accountant is aware of this. Also, don't forget to pay your yearly fee for doing business as an LLC.

8. Health Expenses

Don't forget to notify your accountant of particular health expenses. For example, make sure to track your chiropractor or doctor visits during your tax year and make a note of them to your accountant.

9. Digitize Everything

If you can give your information to your accountant as PDFs, Excel Spreadsheets, etc, that is ideal. No need to waste paper when you don't have too. Just be smart in how you save those files.

10. Ask Questions

Your accountant doesn't know what you're thinking... ask them that burning question. Many freelancers pay more taxes than they should because they assume that their accountant knows everything about their business.

Have questions about your taxes, your experience or just want to drop us a line and say hi? Send us a quick email here and let us know what you think.

Guest post from our friends at FreelanceKit.



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