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Question:


I’m self-employed and filing my first Schedule C with my 1040. Any advice?
-Anonymous


Answer:


Watch for inconsistencies between different sources of the same information. For instance, if the companies that you’ve done work for send you 1099 forms that add up to more than the revenues you declare, you had better have a good reason for it. On the other side of the ledger, make sure that you can justify every expense you take, but also make sure that you’re not leaving any deductions on the table that you could be claiming, such as for interest expense or the prorated amount of your rent or mortgage payment for any portion of your home used exclusively in connection with your business. And don’t forget the other schedules, not just C, that self-employed filers need to submit, such as Schedule SE, which you use to calculate self-employment tax. As both the employer and employee, you have to pay both halves of your Social Security and Medicare contributions, although you get to deduct the employer’s half from your income on Form 1040.

-Conrad de Aenlle



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