In today’s economy, the side hustle is becoming ubiquitous, and in many cases that side hustle becomes a business. That can bring with it a wonderful sense of freedom. But it also brings with it obligations such as keeping track of taxes that require the kind of expertise the Fort Lauderdale Accountants of Sterling Accounting bring to the table.
We recently came across a selection of tips at StartupNation that can help when it comes to keeping up with taxes in the gig economy. Here are a few.
To the IRS, you’re a corporation
When you run a business, whether you employ 100 people or just yourself, you need to be aware that the IRS views you as a business.
According to StartupNation, that means, “The IRS sees you as a mini corporation and, as far as they are concerned, you should be paying taxes just like a larger business does. This means you’ll be expected to pay tax on the profit of your business and have enough money saved up to pay the government when taxes are due.”
Track your expenses!
Keeping track of your business expenses is a crucial part of business bookkeeping that has big implications come tax time.
“What qualifies as a business-related expense? It depends on how you make a living. For example, a recording artist might keep records of the sound equipment they buy, while an Uber driver might claim mileage, cell phone accessories and their mobile phone plan,” StartupNation writes.
Consult an expert
You may be great at whatever business you’re in. But that doesn’t mean you’re great at accounting and tax planning. That’s where experts like the Fort Lauderdale accountants at Sterling Accounting come into the picture.
“Searching online and talking to friends is a great place to start, but don’t be afraid to seek out professional services, as it pays to get advice from a trusted tax advisor who can review your specific circumstances,” according to StartupNation.