I started working as self employed September 26th. When should I file taxes? This is my first job ever and I already received a 1099 misc in the mail. For background, I work from home reviewing videos and I get paid hourly every two weeks. Depending on how many hours I put in, my deposit will vary.
Keep very complete records of everything you earn and records of any expenses you have.
If you just started working in September 2019 you will file your first tax return in 2020, sometime before April 15, 2020 for the 2019 tax year.
Since your earnings will be reported on a 1099Misc that means no taxes or Social Security or Medicare are being withheld from your pay, and you will be paying Self-Employment tax for the SS and Medicare, as well as ordinary income tax. The Self-Employment tax for SS and Medicare is 15.3% of your earnings. Your "ordinary" income tax will depend on how much you earn as well as some other factors.
YOU PAY YOUR TAXES THE SAME AS EVERYONE - YOUR TAX YEAR IS JAN 1 TO DEC 31. TAXES ARE DUE APRIL 15 THE FOLLOWING YEAR, AND YOU CAN EASILY GET AN EXTENSION SO THEY'RE DUE OCT 15.
KEEP TRACK OF ALL YOUR INCOME, FROM THIS JOB OR ANY ADDITIONAL MONEY (CASH OR NOT) YOU EARN. KEEP TRACK OF ANY BUSINESS EXPENSES, SUCH AS BUSINESS MEALS WITH CLIENTS, OFFICE SUPPLIES, SOFTWARE AND HARDWARE, PHONE COSTS, INTERNET, ETC. ALSO MILES ON YOUR PERSONAL CAR FOR GOING SOMEWHERE BUSINESS-RELATED. AND KEEP TRACK OF HOW MANY MILES YOU DRIVE THE CAR DURING THE YEAR, BOTH BUSINESS AND OTHER.
YOU WILL FILL OUT A SCHEDULE C OF THE REGULAR 1040 TAX RETURN. A LOOK AT WHAT A 1040 HAS ON IT, AND PARTICULARLY THE PAGE FOR THE SCHEDULE C.
THIS IS A LEARNING EXPERIENCE!
AFTER YOU FINISH ENTERING INFORMATION INTO THE TAX PROGRAM (PRESUMABLY TURBO TAX "HOME AND BUSINESS" VERSION, PRINT IT OUT AND TAKE IT TO A CPA FIRM TO HAVE THEM LOOK IT OVER. IF YOU'VE DONE SOMETHING WRONG, THEY'LL BE GLAD TO TELL YOU ABOUT IT. YOU MAY WANT TO HAVE THEM PREPARE IT AND PAY A FEW HUNDRED DOLLARS TO GET IT RIGHT.
BE VERY VERY CAREFUL TO KEEP BACKUP INFO ABOUT ALL THE DEDUCTIONS YOU CLAIM. BE VERY CAREFUL WITH ADDRESSES, NUMBERS, AND DETAILS YOU PUT ON THE TAX RETURN.
YOU WILL BE PAYING THE TAX YOURSELF SINCE YOU GET A 1099. IF YOU WERE AN EMPLOYEE, THEY WOULD TAKE TAXES OUT OF EVERY CHECK YOU GET, AND THEY SEND IT TO THE IRS AND YOUR STATE. AS AN INDEPENDENT CONTRACTOR YOU PAY THOSE TAXES YOURSELF. IT'S SMART TO TAKE 20% OR 25% OF EACH CHECK, AND PUT IT INTO A "TAXES" BANK ACCOUNT. THEN YOU HAVE THE MONEY TO PAY THE IRS NEXT APRIL.
BTW, YOU SHOULD GET THE 1099 FROM YOUR EMPLOYER IN JAN 2020 AFTER 2019 IS OVER. ONCE YOU GET THAT YOU CAN BEGIN TO PREPARE YOUR TAXES. GO TO IRS.GOV TO LOOK AT WHAT THE FORMS LOOK LIKE, AND TO FIND OUT THE RULES REGARDING PENALTIES, WHERE AND WHEN TO FILE, ETC.
IT CAN BE VERY COMPLICATED, BUT YOU'LL LEARN A LOT DOING THE TAXES YOURSELF.