FFN #24: Tax Traps to Avoid & FF Exclusive Discount

👀 Enough Stressing About Taxes Already!

I adore freelancing, but the tax and accounting side of it can give me nothing short of a migraine—especially with tax season coming up. A friend and a few fellow Freelancing Females told me about Found - how did I not know about them?! We aren’t gatekeepers here so let me share the love. Found is a business bank account specifically for freelancers, so you can keep your business and personal finances separate. They understand the ins and outs of freelancing, which means they created great features like automatically tracking your expenses and finding write-offs for you (hello tax savings!). When you get paid, Found sets aside money for taxes so you don’t get hit with a tax bill you can’t afford. There are a ton of really useful free features like invoices and contractor payments, too. Plus so you can try them out, Found has a promo code just for Freelancing Females where you can earn $50 when you spend $500 on your Found card. Give them a try by signing up for free (it’s easy!) and using the promo code ‘FF 2024’. #partner

Disclaimer: To qualify for the $50 direct deposit bonus, a user must spend $500 to their Found account within 30 days of account creation. This offer is valid through 3/31/2024. Bonus rewards are deposited into your Found account.
Found is a financial technology company, not a bank. Business banking services are provided by Piermont Bank, Member FDIC. The funds in your account are FDIC-insured up to $250,000 per depositor for each account ownership category. The Found Mastercard Business debit card is issued by Piermont Bank pursuant to a license from Mastercard Inc. and may be used everywhere Mastercard debit cards are accepted.

🖨 Don’t Forget Those Quarterly Taxes  

First and foremost, does the IRS know you’re self-employed? Make sure with each client you have a clear contract stating you’re a freelancer, this is important as it acts as proof of self-employment for the IRS. If you are yet to use contracts and are not sure where to start, take a peek at our templates. As business owners it’s on us to pay what we owe to the IRS, this means we shouldn’t be waiting until April 15 to pay our taxes in one lump sum. Instead, you should be paying four quarterly tax payments throughout the year. You pay these estimated taxes if you expect to owe at least $1,000 in annual federal tax. If you underpay, the IRS can impose a penalty - welp! By paying quarterly tax payments, it lessens the blow and prevents you not having the cash to pay your tax bill, along with ensuring you avoid penalties. We highly recommend opening a business bank account and putting aside 25% of your income ready to cover your tax expenses when the time comes. That’s where great business bank accounts like Found can come in clutch, with their built-in tax estimate you can see exactly what you owe in real time and set aside money ahead of time for tax season.

🕵🏼 Not Keeping Record

A big mistake we often hear about, especially with new freelancers is not keeping adequate business records. Without solid records of your income and expenses, you or your accountant are going to find it tricky, to say the least at tax time. Many people will keep some record of their expenses but will forget their income. Keeping an accurate and detailed record of your income no matter how big or small the payment is crucial, if you don’t record all of your income you won’t be able to calculate your tax liability properly. This could trigger an audit by the IRS and leave you vulnerable to losing valuable tax deductions or receiving a fine if you don’t keep a great record. The type of records you want to keep will vary depending on the nature of your freelance work, however, we suggest keeping a detailed record of every penny you’re spending with some type of accounting software. Surprise! Found can actually help you with that too! Not to sound like we’re fangirling, but they know what they're doing when it comes to Freelancer taxes! Their built-in expense tracking allows you to keep track of and hold your receipts to save you time when it comes to filing your taxes.

🤩 Deductions Our Saving Grace

The best part of preparing your taxes as a freelancer! As you begin preparing your return review what you can claim and start gathering your evidence (receipts!) to support. Thankfully there is a whole host of business deductions we can make but to name a few; start-up costs (up to 5k), home office, retirement plans, asset depreciation, certain meals, hiring freelancers or contractors, business travel, gifts, vehicle expenses, rent, interest on business debt, salaries and wages, legal fees and subscriptions like your phone, internet or Canva bill.

Mylk Labs

My new fave breakfast! Mylk Labs is a delicious women-owned oatmeal brand that makes my life so much easier in the mornings. Their yummy oatmeal cups are ready in a few minutes and actually keep me full until lunchtime. I love that they added a crunchy texture to each cup and that they’re made with natural ingredients. Healthy, convenient and tastes great - what more could you want from breakfast?!