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How to file your taxes as an independent contractor?

I

hey I'm Jaco from ever Lance if you're

an independent contractor and you want

to understand your taxes better then

this video has some great information

for you okay so the first question is

how much should you expect to pay taxes

as an independent contractor so this

will depend on a bunch of factors like

what state you live in and whether you

have any kids but to play it safe if

it's your first year it's a good idea to

save 20 to 30 percent of your paycheck

for taxes but here's the kicker

if you do a good job of tracking your

mileage and your expenses you may end up

paying much less than that so I actually

know many independent contractors who

made around fifty thousand dollars last

year and when they went to their

accountant their accountant said you

have to pay ten thousand dollars in

taxes but once the independent

contractor started pulling out their

mileage and their expenses report their

taxes actually went down from ten

thousand it says something like two

thousand dollars so instead of paying

twenty percent in taxes they ended up

paying four percent so that's why it's

so important to track your mileage and

your expenses but again if it's your

first year you're not sure exactly how

it's going to go down play it safe and

try to put aside 20 or 30 percent a

drink so what do you do with your 1099

form so let's start with the basics the

1099 is the main tax form that

independent contractors to get from the

companies they work for so if you made

over six hundred dollars a year working

for a company you should get a 1099 by

mail or email at the end of January so

if it's after the end of January

February and you haven't gone in the

form yet and you made over six nine

dollars you may want to contact the

company but keep in mind some companies

do have different limits so that's why

it's a good idea to check out that okay

so once you've got in the form what do

you do well now it's time to go do your

taxes this is the main form where it's

gonna show how much money you made in

the year okay now another thing to keep

in mind is even if you made less than

six hundred dollars you don't get a ten

any

you still need to report it to Uncle Sam

Uncle Sam knows that you made the money

so it's a really bad idea not to report

okay so how should you decide if you

should do your taxes yourself online or

by hiring an accountant so like with

most things in life if you hire someone

you're probably gonna pay a little more

but you expect a higher quality product

since in this case a higher quality

product means saving more on your taxes

it might actually be worth it but not

always for example if you only do

independent work for a few hours every

month then it might not be worth it but

if it's your first year and you have a

lot of questions and you'd like to get

them answer the person maybe it is worth

okay so in terms of cost if you do go

hire an accountant how much did you

expect to pay probably somewhere between

100 and 250 dollars if you go for a tax

software it'll be more like a hundred to

two hundred so you can see the

difference is not so big keep in mind

that with a tax software price I just

said it's higher than what you normally

find advertised on the websites and

that's because as you go through the

process of preparing your taxes online

there's probably gonna be add-ons there

you're gonna need to pay for like States

and other self-employed in pieces so so

it in the end it ends up being more like

that hundred to two hundred for tax

software and 150 to 250 for tax

preparers okay and one more thing if

you're gonna hire a tax repair it's a

good idea to look online for the reviews

to ask family and friends for

recommendations and to make sure that

they have experience working with

self-employed individuals and the final

thing is that if this is your first year

doing this and you're curious about

what's a better solution for you it's

not a bad idea to hire attacked repair

and then also do your taxes online but

not actually submit them online so you

won't actually have to pay for the

online portion you'll just see which

experience do you like better and which

one actually saves you the most

so there you have our best tips about

how to decide whether it's higher attack

repair or to do your task yourself okay

so now you know a little more about

taxes as an independent contractor you

should check out our other videos to

learn more tips for independent

contractors and if you're looking for a

tax preparer or you want a great

discount to doing your taxes online

download the ever lands app and we'll

hook you up with those resources right

there