Friday, August 3, 2007

Help! I am self-employed. NOW what do I do?


I recently began working for the US Dept of Commerce on a contract basis, so I have no taxes withheld and receive no benefits. I've never been a contractor before, and thus never had to pay my own taxes, so I'm wondering if there are any self-help resources out there for me, preferably any software that will do it for me??

Please help me!!
Andrew from Utah

Hello Andrew,

A word processing program cannot make you a writer. A calculator can't make you a mathematician. A software program cannot be your bookkeeper or accountant.

Switching from employee to self-employed status is daunting because nobody tells you where to start to get information -- and you need a lot of information.
As a new indie, the areas you need to learn about break down into:
*** Recordkeeping for income
*** What are dedcutible business expenses
*** Recordkeeping for expenses
*** What taxes do you pay
*** How do you pay taxes

I recommend you start by reading a short column on my website, such as: Is it a deductible business expense? and Estimated Taxes, a post on this blog.

If you like what you read there, I encourage you to buy a copy of my book, Self-employed Tax Solutions, featured in BusinessWeek. The book answers many of the most common self-employed questions in the same easy-to-understand style you'll find in my columns.

Solutions will give you a basic understanding of what it means to be self-employed. This understanding will give you the confidence to know which step to take next.

I wish you much success.

Best regards,
June Walker

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