Freelancers Incorp?
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- eyemistisorange
What do freelancers usually file as, what kind of cororation or do they even incorporate or are they sole proprietors usually or what?
Im in Florida and I am trying to figure out all the stuff i need to do to be able to freelance. Taxes, business licenses, etc.?
- wedgehead0
under the table dawg
- derek20050
if you create a company, you can charge for overhead, and come across as much stronger...
imagine charging 100 an hour vs 40 or 50...
work from home, and possibly contract out some work to buddies...
its up to you...
- Meeklo0
I would like to know more about this too..
- instantok0
there are really a lot of factors...the state / city you live in and the required licenses etc...and the amount of money you make doing business for yourself...i think a local accountant is probably the person to speak with...ask some local freelancers who they work with
- woodyBatts0
my stepfather is an accountant and lawyer and explained it to me like this, stay unicorporated until you are fined for writing off what a company would right off, once you are approaching the amount of write offs for the fine ( 10 k , varying on state ), incorporate yourself.
Once incorporated you can recieve gov't compensation for things like a medical insurance for employees and such, you can also write off subcontractors.
That's what he told me.
- arthur0
Being incorporated can save you plenty on your taxes.
I'm inc, pay myself a "reasonable" salary, which is taxed at around 40%. What I earn over my salary is taxed at around 28%.
May not sound like a big difference, but I'll save about 10k next year on this aspect alone.
- liquid0
S corp....
liability....tax down to local...ability to take draws.... and plenty to write off....
- eyemistisorange0
So I guess Freelancers don't normally incorporate, they just fill out 1040 or some form and pay thier taxes? quarterly or once a year? Do they need a state business licence if not incorporated?
But most of you are saying its better to incorporate? I am just starting out freelancing, dont really have any clients right now and I have a full time job right now so I don't know if it's better for me or not to incorporate since I will be doing it on the side for now?
- fr0st0
if this is your first time freelancing.. then just do it under the table, once you get more clients and doing more freelance than your fulltime job, then i think u should go inc., but for now do it under the table and dont let uncle sam get any!
- cgibaldi0
hey. s-corp is the way to go here. you will be able to pick up your own insurance, handle write-offs as you see fit, and as others have responded, you can eventually get better leverage when it comes to dealing with clients and hiring subcontractors.
no company is going to pay you under the table and if they do, they might not be worth dealing with. first thing, you should get yourself a good accountant. you will have to pay fees for that, filing, and quarterly for your corp. but if you are generating enough money, at the end of the year you will be more satisfied than letting some company do the tax work for you.
- eyemistisorange0
I was talking to this guy yesterday and he said that his wife, who use to be a freelance designer, filed as a "Subchapter S", anybody familiar with that, if so does that sound like the right thing to do?
- liquid0
see my response and the one before yours....its an S corp....you file and the state sees you as a C but then you file the subchap S papers and you dont get double taxed
- arthur0
If you're just starting out and not earning lots of freelance income yet, you could just file as self-employed 1099. I filed that way for about 6 years and it was fine. Now that my business is picking up, it makes more finiancial sense for me to be an S-Corp. Start off small and uncomplicated.
Someone already said, no worthwhile company is going to pay you under the table. As long as you're making more than a few hundred bucks, they're going to report your earnings, and you'll have to too.
You'll want to check if Florida requires you to have a business license. Talk to an accountant, a self-employed one, not one at a big firm who will not be aggressive.
- studderine0
Or you can not file for taxes at all, and just get paid under the table. HEY DUBYA IM KEEPING MY MONEY.
- studderine0
Or you can not file for taxes at all, and just get paid under the table. HEY DUBYA IM KEEPING MY MONEY.
- caseyc0
I just file the 1099, my tax lady told me to take less deductions at my full time gig to compensate for the taxes on freelance.