Have you started preparing your taxes yet? Maybe you dread every year getting all your books in order. It seems tax time comes around so quickly. Here are some things you should know about taxes and your virtual assistant business:
- You are a business owner and need to report your taxable income, both on Federal and State tax returns.
- Most likely you will file as a Sole Proprietor using your Social Security number.
- You will need to file a Schedule C to report income or loss.
- Schedule SE needs to be filed to show self-employment tax due.
Keep track of all business expenses to reduce your taxable income. Business expenses may include:
- A portion of your telephone bills; this may include a cell phone, land line, fax machine, any payments for Skype and internet access charges.
- You work from a home office. You may be able to deduct for the portion of your home used for an office.
- Did you buy new equipment this year? Office equipment such as a desk, chair, computer, and headphones can be deducted.
- Other office expenses that can be deducted are supplies such as copy paper, ink cartridges, pens, postage. Don’t forget about software you use to run your virtual home office.
- Do you subscribe to tools you use in your home office? QuickBooks, HootSuite, Office365.
- Your costs for domain name, website hosting, website updates.
Can you think of other things you can deduct as business expenses? Please share your tax tips here!