Understanding Your 1099 Form As A Freelancer

By Norbert Higensen


Tax season is just around the corner. The beginning of each year brings resolutions, a new start, and a review of last year's finances. Depending on your employment and your life situation you will either be required to pay taxes or you will receive a tax return.

Freelancer jobs in America have grown exponentially in the past decade as more and more individuals are opting to perform their work or offer their services to different companies from the comfort of their own home or office.

Deduction vs. Credit - First, it is important to understand that there are 2 primary ways to reduce the amount of taxes you pay. Deductions and credits both take money off the amount of taxable income but they are slightly different in how they affect how much money you save.

While this control gives you power it also gives you better judgment. Investments are much more naturally made and you will get much higher returns because of it. Because you learn to take control your judgment allows you to make better long term decisions that will inspire much more financial success in the end.

When you are able to let go of your money and realize that it is a tool that you have and not something that the world revolves around, then you have an empowered mindset that allows you to create sustainability in every aspect of your life.

The concept is pretty simple. You get what you give in life. For instance, if you give love then you get love back. If you give time to somebody then you get time back. The same goes for money as well. So for those who are being stingy and trying to save up they may be hitting a plateau. If they would just let go of the thing that is starting to control their lives then they might actually gain control over things.

Tuition - There are several deductions and credits related to higher education. If you're a student, you want to make sure that you do not miss out on those. The amount that you are able to deduct depends on your income, so check with an accountant or tax professional to see what you qualify for.

One of the main benefits of being an independent contractor, or freelance worker, is that you can deduct many things from your taxes as business related expenses. One of the major deductions that freelance workers can deduct from their taxes is their own health insurance costs as well as the health insurance costs of your spouse and your dependents.

There are several more deductions that you can claim depending on your situation. The best way to reduce your taxes and get a better return is to take the time to learn which deductions and credits you qualify for and take advantage of each one.




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