(NEW YORK) -- In this economy, many people who haven't been able to find jobs have started working for themselves. And in the eyes of the IRS, it's a whole different ballgame.
For the first time, you might be facing estimated quarterly payments, the 1040 Schedule SE and a whole lot of organizing. “A person should be keeping an excel spreadsheet or using some software to keep track of everything,” said accountant Janice Hayman, who says there's a new tax break for the self-employed this year.
“Their health insurance premiums will now be, for 2010 only, deductible against their self-employment tax.”
And for next year's taxes?
“The self-employed also get a benefit of the employees’ reduction in FICA tax,” Hayman said. “There's a two percent reduction from 6.2 percent down to 4.2 percent.”
It's like getting a 2 percent raise in 2011.
Hayman warns again to keep your records, because the self-employed are more likely to face an audit.
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