January 17, 2020

How freelancers and side hustlers can calculate 3 tricky tax breaks on your Schedule C

Published Fri, Jan 31 2020 4:00 PM EST Updated Wed, Feb 5 2020 11:49 AM EST

Originally posted here

If you’re a freelancer or are self-employed, deducting your business expenses from your taxable income can help you save money.

When you’re preparing your tax return, you’ll track those business expenses along with your income using what’s commonly known as a Schedule C, part of the Form 1040. You’ll use this form to claim deductions for many of the expenses you’ve incurred throughout the year. These may include everything from buying a stapler for your office to paying for advertising costs, and most will be clear cut.

But some of the expenses you’re entitled to deduct aren’t straightforward. That’s why it’s important to take your time filling out your Schedule C and calculating your deductions, says Matt Rosenberg, a certified public accountant and a member of the American Institute of CPAs’ Financial Literacy Commission.

Not only is it one area the IRS tends to scrutinize but being precise about your deductions can significantly lower your overall taxable income. “Making sure you have the right number is really the goal,” says Rosenberg.