Freelancers - Avoid That Audit

Written by Rachel Goldstein

Article submitted by - 1000s of freelance jobs, articles, and resources.

You probably aren't too concerned about being selected for an audit. Well, if you're a freelancer, avoiding an audit should always be on your mind as you file your taxes. Why? Because, no matter how straight you play it, freelancers get audited much more than salaried employees do. No -repparttar United States IRS doesn't have it in for independents, butrepparttar 117422 numerous deductions that we file set us apart from other taxpayers.

So what can you do to keeprepparttar 117423 IRS from noticing your return? Below find hints and suggestions to keeprepparttar 117424 IRS away! These tips are particularly relevant to those inrepparttar 117425 US, though other tax systems may be similar -- check with your accountant for details. And please note thatrepparttar 117426 information provided here should by no means be used as a guide to filing your taxes! These are merely suggested tips and hints. Be sure to seek professional advice in taxation, as in all business matters.

Six Steps to an Audit-Free Tax Return

1. Be Careful With Deductions

The IRS's favorite target isrepparttar 117427 home office deduction. In order to qualify for a home office deduction, your office needs to be your "principal place of business" and used "regularly and exclusively" for business. In plain language, this means that your home office needs to berepparttar 117428 place where you spend most of your time and makerepparttar 117429 majority of your income.

You'll also need to keep your personal life out of your home office. For example: a trick that I heardrepparttar 117430 IRS sometimes uses is to askrepparttar 117431 taxpayer being audited "Do you use your computer for 50% personal and 50% business or 5% personal and 95% business?" If you answer 95% business, you have flunkedrepparttar 117432 test --repparttar 117433 answer needs to be 100% business. This example demonstratesrepparttar 117434 strict enforcement ofrepparttar 117435 guidelines forrepparttar 117436 home office deduction. We'll talk about this more in Home Office Deductions for Freelancers.

You also need to keep other deductions that you want to take to a reasonable level. Keep a receipt for all deductible expenses, especially food, entertainment, travel, and automobile costs. These are oftenrepparttar 117437 deductibles that are most scrutinized byrepparttar 117438 IRS. You should also keep expenses in a log, alongrepparttar 117439 following information:

Should You Take That Freelance Gig?

Written by Rachel Goldstein

Article submitted by

Believe it or not, there are certain projects that you probably shouldn't accept. Turning down work is probablyrepparttar hardest decision you will need to make when running your business, but sometimes turning down a gig is necessary. In this article I will explain to yourepparttar 117421 details that you need to consider when you aren't sure which route to take. Considerrepparttar 117422 following:

1. Will I Learn From This Gig? - As a freelancer, especially one in a technical field, you are expected always to be on top of new advances in your field. Therefore, taking a gig that will help you learn about something is probably worth taking on. However, it is important to make sure that you can dorepparttar 117423 job well even though it is new waters for you.

2. Is The Money Good? - Ifrepparttar 117424 gig pays a lot of money, takingrepparttar 117425 money without any other benefits is probably a good idea. I am sure that you have an hourly rate, use this rate as a gauge to decide whether to take a job or not.

3. Do You Trust The Client? - If a potential client gives yourepparttar 117426 heebie-jeebies then your instincts are probably telling you something. Dorepparttar 117427 potential client's references check out? If you mistrust a potential client, butrepparttar 117428 pay looks good, perform a background check. An untrustworthy client could cheat you out of a lot of money, and isn't worthrepparttar 117429 collection efforts.

4. Does The Project Fit With Your Moral Code? - If a potential client offers you a gig that really disgusts you, you need to turnrepparttar 117430 job down. If you do take it, you are definitely going to regret it. In addition, you won't be able to add this project to your portfolio . it just isn't worth it.

Cont'd on page 2 ==> © 2005
Terms of Use