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Stop Doing Your Own Taxes
Tax Relief
This week is about stopping a habit and replacing it with a new one! Let’s examine an important aspect regarding finances that many freelance web designers overlook: handing over tax duties to a professional.
Habit of the week:
Stop Doing Your Own Taxes
Start asking colleagues and friends for referrals and find an accountant that fits your needs. Many freelancers cherish their control over their business processes, including finances. However, regarding bookkeeping and taxes, there might be more efficient ways to manage your affairs.
Why it matters:
Managing your taxes is not just about keeping records and filing; it's about making wise financial decisions. Proper bookkeeping allows you to handle transactions, bill clients, file returns, and pay income taxes effectively. However, the complexity of managing detailed accounts payable, accounts receivable, purchases, and sales often requires professional expertise.
Quick Start Guide:
- Understand the Basics: Even if you plan to hire an accountant, understanding the basics of freelance accounting will help you manage your finances more effectively. This book has been a great reference to me over the years.
- Recognize When to Get Help: If your business involves multiple income streams, subcontractors, or significant equipment expenses, it's time to consider professional help.
- Choose the Right Accountant: To get the most relevant service, look for an accountant who specializes in freelancing or small business accounting. I don't know what I'd do without mine!
Cami's Tips
- Save Time and Stress: An accountant can save you countless hours and significant stress by handling complex financial tasks, allowing you to focus on growing your business.
- Avoid Costly Mistakes: With changing laws and potential penalties at stake, an accountant ensures that your financial responsibilities are met accurately and on time.
- Plan for Growth: Accountants do more than taxes; they can act as business advisors, helping you make decisions that could significantly increase your income and business scale.
- Save for taxes: Make sure you're putting a good portion of your income in monthly savings for taxes and sending in quarterlies.
- Start Looking Now: Get an accountant lined up way in advance of when you need to file. I can't tell you over the years how many folks have asked me for a referral in March. That never works. Reach out in May!
Routine Checkpoint:
Remember, time is your most important commodity. Are you spending too much time on taxes or bookkeeping? Are there financial goals you're struggling to meet? It might be time to consult a professional.
Review your current financial management strategy. Determine if you would benefit from outsourcing your tax filing to a pro.
What's Your Take?
Have you transitioned from handling your taxes to using an accountant? How has this shift impacted your business efficiency and personal stress levels? Please share your experiences using #WebDesignerHabits and join our community discussion!
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Podcast Episode:
about the author
Cami MacNamara is a web designer and owner of WebCami LLC, a Seattle-based agency since 2002. She created Web Designer Habits to help solopreneurs build smarter systems, stay productive, and run a business that works for them.