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Accounting Services

Perhaps you became an independent contractor because you like the flexibility of setting your own schedule, determining your own pay rate, and working for more than one client at a time. There is also the possibility that you had no choice in the matter. You either had to accept work as an independent contractor or not work at all. In either case, we recommend scheduling an accounting consulting appointment with A&B Accounting and Business Solutions, LLC at least once per year.

Tax Mistakes Made by New Independent Contractors

What many first-time independent contractors fail to realize is that they are both the employer and the employee in the eyes of the IRS. This means that you are responsible for paying the employer portion of Social Security and Medicare taxes as well as your own share. When you don’t plan for this expense, you could be in for an unpleasant surprise at tax time.

The IRS requires self-employed people to establish and pay quarterly income tax based on their expected income. The deadlines to make these payments are January 15, April 15, June 15, and September 15 every year. However, you may be exempt from quarterly reporting if your income falls below a certain threshold. In that case, you would report all earnings and deductions on your annual income tax return.

Independent contractors also make errors when it comes to deducting legitimate business expenses. In most cases, this is because they are unaware of what actually qualifies. Before you file your taxes for the year, read IRS literature to ensure that you know what does and does not qualify you for a deduction.  We offer a variety of accounting services to fit your needs.

Schedule Your Appointment Before the Rush

Tax season will be here before you know it, but you don’t have to go it alone. Just contact us to schedule a consultation appointment or to have us prepare your return.