1099 Work Questions

Put 40% of your checks in a savings account and don't touch it
Keep a detailed mileage log
Every time you go out to eat or do something fun, save the receipt for Meals/Entertainment
Take the sqft of the biggest room in your house and use that square footage as your "home office"
Write off your internet and phone

Basically write off everything you do I did the above and saved 40%, and I ended up oversaving by a good bit

Keep everything. Get the mileage app for your phone. Using a CC or debit card makes it alot easier to track business spending at the end of the year. I'd get a dedicated business CC and put everything on it.

40% seems high, but not terribly high. Get with your tax pro and start making quarterly estimated tax payments.

quote:

---

Concerning the vehicle, would I be better off purchasing, maybe possibly, leasing a newer vehicle in order to write-off depreciation value?

---

Never do this. My CPA told me "buy a new car if you had a great year AND need one." I ignored her and bought a new one every 3 years because I'm a dummy.

You'll get to deduct mileage which is $0.55/mi or somewhere around there. You can make a killing if your vehicle is paid off AND reliable.

quote:

---

What do I need to do as far as tax purposes come for next year?

---

The most important thing is to keep good records. I set up a separate email where I could email pictures of work-related receipts, bills, invoices, etc. I would write a detailed subject line ie "New Tires receipt...". It was helpful when I started organizing my expenses for the year. Trust me: you'll forget about that $600 printer you had to buy in February unless you keep good records.

If you can save enough to pay quarterly, you're doing better than most.

1. you have to pay estimated taxes to state and federal quarterly.

2. you pay both parts of FICA (but you get to deduct half as self employment tax)

3. Mileage is a little tricky: IF you have a true home office, it's a little easier. You can deduct work related miles from office to site and back; but if you are a 1099 in name only and physically work at same site everyday it could be disallowed. Keep a mileage log that clearly explains your trips, dats and lies driven.

4. You can write of true business expenses. Country club dues and such are not really deductible. Meals with a business purpose can be deducted. Office supplies, etc. Keep receipts.

5. The best part is you can have either a solo 401K or a SEP IRA. Both are available through fidelity, TD amritrade or scwhab etc. Solo 401K allow you to contribute as employer and employee.