![]() Of course, whether it’s from freelance assignments or book sales, writing income can vary a lot from year to year. There are also lots of ways to reduce a hefty tax bill, which we’ll get to in a moment. CPA Soo Lee, who has more than 10 years of tax experience, explains that this is because “none of your taxes were withheld from your income.”įortunately, we only need to do this if we expect to owe more than $1,000 in taxes for the calendar year. In addition to owing more money out of pocket, self-employed writers also need to pay taxes quarterly. These go to the IRS and - depending on where you live - your state. You pay those on top of your regular income taxes. Your tax obligation doesn’t end with your doubled FICA taxes. The difference for self-employed people: They need to pay both the employer’s 7.65% and the employee’s, for a whopping 15.3%! It hurts, yes, but it’s a price worth paying for a life of freedom. ![]() Your employer then matches this, giving the IRS another 7.65%. When you work a regular W-2 job, you pay 7.65% of your paycheck in FICA taxes. Whether you’re self-employed or at a traditional 9-to-5, all earners in the US pay into FICA, the fund that supports Social Security and Medicare. It’s a fancy way of saying we need to cover the employer’s half of FICA, short for Federal Insurance Contributions Act. Self-employment tax is, naturally, something all freelancers, independent contractors, and small business owners pay. No matter what kind of prose (or verse) you get paid for, here are three types of taxes you might have to pay on your writing income. As self-employed workers, indie and freelance writers have to deal with some extra taxes. In general, though, the IRS considers writers to be self-employed - unless someone’s paying them a regular W-2 salary to come into an office and write. In order to make a living off our craft, lots of us even do multiple forms of writing.Įvery writer’s tax return will look a little different. There’s a lot of different people who can call themselves “writers,” from content marketers to poets.
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