Topic: register as company (Page 1 of 1)

I have been freelancing for 2 years and just nabbed a client who agreed to pay me $25 to upload images to his site. Apparently he has lots of work to do so this may give me some solid income in addition to my FT job. I fugre I want to rake in around $500-600 per month. Now, That sounds all peachy keen and all, but when its time to do my taxes- I am anticipating that a large portion will be taken away from !

Question: What are the benefits if I register my freelancing as a company. (Is this the correct terminology?)

∙ Will I be able to hold onto more % of my freelance money?
∙ How much does it cost to register?

Thanks
-CRO8

Registering the company will not affect your tax status. With only about $6000.00 per year of income, your best way of reducing your taxes is to make sure that you use all possible business expenses to reduce the amount you are reporting as taxable income. Any software or hardware expenses, travel expenses, or advertising expenses you may incur related to this company can be used as deductions. If you can dedicate a room in your house to use as an office, a percentage of your utilities, mortgage, and upkeep expenses can be deducted. Keep in mind that you need to report at least $1.00 profit three years in every five for the company to be considered a company by the IRS.

I am assumuing that you have other income besides the $6000.00 to $7000.00 per year you are projecting from this company. If not than your income is so low that you needn't worry about the amount you will pay in taxes. That amount of income has little or no tax on it.

The advantage of registering your company name is that it makes it more difficult for someone else to come along later and use the same name for their business.

Once your company starts getting enough incomke, you will want to consider incorporation. This will allow you to divide the income between yourself and the company so that the over all tax rate is lower. But, right now it is too early for you to be considering that.

cool beans. Thanks hyperbole. I wasn't sure what to do, I am not in a ruch now. Yeah- I have a FT job right now, so this is extra income. It looks great, estimating $500-$600 extra cah per month. But then I thought about having to pay taxes on it! Ugh! Anyways, thanks.

-CRO8

He's forking over money to have you upload images? wow he must be REALLY busy. Hey and who can't use another $500-$600 extra cash per month?

::: Jon :::

hmmmm. well, the client who was going to pay me $25/hour to upload images has backed out. He has had bad experiences with freelance designers in the past and was scared when I gave him my one page estimate of an hour. I immediately replied his last email and provided the names/addresses of my past client- showing that I am an honest person and keep a good paper trail! You win some, you lose some. I wll keep you all updated.

-CRO8

Hey bummer, sounded like a pretty sweet deal. To bad...
Yeah you do lose and win some, but I'd rather not lose them.

:: Jon ::

Edit TP: spam removed.

(Edited by Tyberius Prime on 01-07-2015 12:33)