Taxes for the Self-Employed

For many, being self-employed is exciting: You’re your own boss, so you get to work how you please, where you please, when you please, and for whom you please. But that greater freedom comes with greater responsibilities. And nowhere is that more true than with your taxes.

If you’re in business for yourself, or you want to be, there are certain differences between your tax return and that of an employee. For starters, the tax code allows a much greater range of deductions for the self-employed than for employees. The greater value of these deductions can help offset the greater work expenses that the self-employed have.

In this section, we’ll take a look at some of the details, tax-wise, of working for yourself:

• What defines a business versus what defines a hobby
• The different business structures you can choose from when you start your business
• Self-employment tax and estimated tax payments
• All about filling out Schedule C, the main tax form for the self-employed
• Business assets, depreciation and the Section 179 deduction
• What expenses are deductible, and which are not