Do you meet with clients to discuss projects face-to-face? If you decide to foot the bill of such me

Being a contractor,freelancer, or otherwise self-employed allows for the potential of taking many tax deductions that normal W-2 employees cannot take. Here are some of the most common tax deductions for freelancers and contractors.
One of the benefits london hotel discount of being a contractor, freelancer, or otherwise self-employed individual is the potential for tax deductions to reduce the amount of income tax you owe. About a quarter of the United States working population, or 27 million people, are freelancers, contractors or sole proprietors – according to the National Association for the Self Employed. Even when freelancers are diligent and pay estimated tax payments throughout the year, many end up owing money at tax time.
The IRS allows contractors london hotel discount to deduct anything london hotel discount considered "ordinary london hotel discount and necessary" london hotel discount to conducting your business. Here are a number of tax deductions that most contractors or freelancers can legally take, which will help reduce the amount you pay to the IRS.
If you attend conferences in your business industry, purchase books or other research related materials to perform your job and further your knowledge, these expenses are tax deductible with appropriate receipts and documentation.
Depending upon your income level you can choose from various retirement options that can help reduce your taxable income for the current year or for the years you withdraw from your retirement fund. Below are the two most popular types of retirement accounts for self-employed individuals and some basic information on each:
Traditional IRA : With a traditional IRA the contributions are tax deductible the year the contribution is made. These taxes are deferred until they are withdrawn from. Anyone can contribute to a traditional IRA since there are no income restrictions, but there are limits london hotel discount to contribution amounts . With this type of account withdraws begin at at 59.5 and are required by 70.5.
Roth IRA : With a Roth IRA the contributions are not tax deductible in the year the contribution is made since taxes are paid the amounts prior to making the contribution. With this type of account all earnings and principal are tax free. One nice thing about growing money on a tax free basis is that you can use the Roth IRA as a dividend shield and avoid double taxation on dividends. A downside to the Roth IRA is that there are income limits and contribution limits .
Do you meet with clients to discuss projects face-to-face? If you decide to foot the bill of such meetings, you can deduct half the expenses. Keep your receipts and good records for who you meet with and a brief description of topics discussed.
If you pay other freelancers or subcontractors to help you on a project (which allows you to take on more work than you could handle on your own), you can deduct the expense of paying the subcontractor for their portion of work. Keep invoices sent from contractors to show that you have "contractors" and not "employees", and keep a record of when each payment was made.
If you maintain an office or work area in your home, you can deduct a percentage of your mortgage or rent, utility payments, and homeowners or renters insurance premiums. The percentage of deductions you're allowed for these expenses depends on the size of your office area – the square footage of a room used entirely for an office, or the desk area in the corner of your living room, for example. If your office area is 12% of your total home square footage, you can deduct 12% of home expenses.
While you can't write off the membership to the gym (unless maybe, if you are a freelance fitness coach?!) there are a number of business related professional memberships which are legal tax deductions. If you join an organization for sales leads or networking, like the local Chamber of Commerce or the Lions Club, you can justify the expense as a business one.
You can't claim the costs associated with commuting to and from an office, but if you travel from your home office to meet a client london hotel discount or conduct research, the travel is considered a necessary business expense. london hotel discount You can include tolls or parking fees in your expenses. You're allowed to write off the cost of travel expenses , such as a portion of wear and tear on your vehicle, or public transportation costs, or you may decide to take the IRS standard london hotel discount mileage deduction which covers london hotel discount gas, insurance, maintenance and depreciation.
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