How to Write Off Expenses When Filing a 1099
As an independent contractor or freelancer, the Internal Revenue Service labels you as "self-employed." When you are self-employed, you receive a Form 1099 from clients, which includes all of your earned income. The 1099 is needed in order to file your tax return. On your return, you can claim business expenses as deductions. A deduction decreases your total taxable income, which may reduce the amount of taxes you owe.
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Instructions
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Request a "Form 1040" and "Form 1040 Schedule C" from the Internal Revenue Service. These forms can also be downloaded and printed from the IRS website.
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Complete Form 1040 by entering all of your wage and income information, as well as credits you are qualified to receive.
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Enter your business expenses in the "Deductions" section of the form. You have the option of taking a "Standard Deduction" or "Itemized Deductions." A standard deduction is a set dollar amount to cover your business expenses.
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Choose the "Itemized Deduction" if you wish to list your business expenses item-by-item. If your business expenses exceed the offered dollar amount of the standard deduction, it may be to your advantage to itemize your deductions. You can write off expenses for your home office, transportation costs, office equipment, supplies and any other business expense incurred during the tax year.
If your spouse files a separate return, and itemizes deductions on that return, you are prohibited from taking the standard deduction.
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Complete the Schedule C form. This form requires you to enter your business income, business expenses and cost of goods sold (if applicable). All of your business expenses are entered in the "Part II -Expenses" section of the form.
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Make a copy of your completed 1040 and Schedule C forms. Maintain the copy for your own records. Submit the original copy of the forms to the Internal Revenue Service.
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Tips & Warnings
Keep a copy of the receipts detailing your reported business expenses. In the event of an audit, the IRS will request to see the receipts.
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