Earning on the Internet? Keep It Legal - Claim Expenses for Online Income
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Earning on the Internet starts to look unattractive once you pay that first big tax bill. For those who are used to worrying about their income taxes only once a year, paying a large chunk of money in the spring may cause undue financial strain.
If you find yourself earning quite a bit of money through your online efforts (thousands of dollars), you will likewise find yourself owing a pretty penny to the government via income and self employment taxes. Itís vital that you claim expenses on all of your online income, saving yourself a little tax strain and making it viable to continue to earn with the Internet.
Paying the self employment tax on top of your income taxes can feel like quite a burden, but there is a way to lessen those tax payments by claiming your expenses. If youíre earning money through your online efforts, then youíre an independent contractor -- and you probably have costs of your own.
Earning income with the Internet? Any computer equipment or office supplies your purchase in the line of work is tax-deductible. Any miles you might put on your vehicle while going to purchase equipment and office supplies is also tax-deductible, and so is the gas you use to drive yourself to and fro.
Keep all your receipts to keep track of everything you can claim. This helps reduce the total amount of taxable income you earned during the calendar year, thus reducing the amount of taxes you have to pay.
Keep Your Income Legal!
Earning on the Internet is a great way to supplement your income or even create a career. There are lots of ways you can earn and plenty of opportunities to find, but always remember to keep your income legal. Everything you earn is taxable, and everything you earn must be legally claimed with your government. To do otherwise is to break the law -- and that means you could potentially forfeit the right to a lot more than just money.
If you find that youíre unsure about your finances, the amount you owe or anything else involving the legality of the income youíve earned, consult with a financial professional. Itís always better to be on the safe side, because the alternative is the wrong side altogether.
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