Freelance Writer Taxes

I've been doing writing for some time now and customers always pay me via PayPal. Do I need to report this business and what about the taxes? I really have no idea how this works.

The short answer is: yes.

Assuming you are in the US

If you are paid for providing goods or services to others, the money you earn is subject to Federal Income Tax, and almost certainly State/municipal income tax. You may also be liable for other taxes as well, depending on where you live and how much money you earn from this business.

It doesn't matter where your clients are located, or how they pay you.

If you plan to continue freelancing you owe it to yourself to look into the details. Non-payment of taxes means you're liable for interest on unpaid sums. Not filing the tax forms means you're liable for huge penalties in addition to that interest.

The US Small Business Administration has a several initiatives to help small businesses, including business-creation basics. You'll find most of this online. The SBA frequently offers free or low-cost seminars through the public library system: if you live in or near a city with a good public library, check there.

I offer a "basics" course but the next time won't be until late summer.

Agree with Lowengard ... in the US, the Federal and State Government want a piece of your earnings.

Paypal does not normally report things to the IRS, but you do not want to get audited just in case. Go to some tax preparing place and file. When I worked as a sole proprietorship I just reported it as self employed income.

In Canada (and I am sure its the same in most countries) you are obligated to report all your income, be it in Canada or elsewhere. Hence, I always report everything, including PayPal revenue.

A story on National Public Radio this morning (29 June) highlights the need for keeping good records of your income, and for contributing the appropriate income and other taxes. I don't imagine that you think your freelance business will be threatened in a national emergency but still...

"Cash Business in Gulf Makes Compensation Difficult"
http://www.npr.org/templates/story/s...ryId=128169388

I don't want to start a business, I like freelancing more. I'll certainly look into this a bit more. Is there any minimum monthly/yearly earned sum under which you are not obligated to report taxes?

Sorry--if you take money from people in exchange for products or services, you're in business.

Freelancing is a means of obtaining work. Even if you want to keep it casual, it's a business.

There is no minimum sum under which you're not obliged to report income.

There is a minimum sum under which you're not obliged to pay taxes. If you have a day job I imagine you earn more than that minimum.

That is true. As long as you take money for services rendered it is business. You are just in business for yourself. Our band has gigs and we have someone doing the books, paying everyone and docking our pay for our taxes.

OP ( original poster/person who started this thread.)

Depends on where you're from ... if its in the US. Then yes, legally you're required to pay taxes on any income. The IRS tax code is ridiculous. Could tell you some very interesting facts about it.

One of which being its illegal and unconstitutional, the whole tax system ( and banking system ) in the US are. But I dont want to think about that crap right now. ( cracks knuckles )

Here's the thing ... odds of you getting audited and caught are slim regardless. Though as technology evolves, that could change. My philosophy, is screw the tax man ( people ) every chance you get.

Why the hell would I pay the govt taxes. When they are going to take my $. And use it against me ? They are all crooks themselves and the US govt. Is a tyrant, by any reasonable standard.

When the law makers are crooks themselves. Legality loses its meaning. Only my morals and personal codes of conduct ... mean anything to me.

lol, anyway Im ranting. My advice would be to seek out a CPA ... that specializes in self employed persons, sole proprietors etc.

They know the loop holes in the law. That the politicians intentionally leave in it. So that they and the rich/Corps etc. Can legally pay zero taxes. If you find a good one, then your butt is covered legally speaking.

Morally speaking ... sighs, whole nuther ballgame.

legal disclaimer: I am not advising anyone to do anything. That violates any of the 6 gazillions federal/state/city/county laws in the US. But if someone were to do everything they can. Not to give the authorities any of their hard earned money. It would be understandable. Since they are stealing from people anyway.

PS, also by US law ... the IRS has to settle outstanding debt, ( unless its been changed ) for pennies on the dollar. Even if you get caught. You sometimes see those people on TV. Saying I owed the IRS 5 million bucks. But so and so debt relief got it down to $40,000. That's cause they know the law and how to stroke it.

Fark .... once again see legal disclaimer above. Addition to legal disclaimer. I take no responsibility for damage resulting from the contents of this post.

Any harm to persons/property that may result from this. Are not done with my consent or participation. I take no responsibility whatsoever lol. And the US govt and all its affiliated entities can kiss ma butt ...

Sighs ( update ) ... In for a penny, in 4 a pound. You want some interesting reading. That will open your eyes to some econ/financial facts .... google "fiat currency" or "fiat money" a better search that will bring up more relevant/credible results ... dangers of fiat. Also take a few mins. To look up the history of the US federal reserve. Which is not a govt entity, btw. Its a private banking syndicate.

If you do and discover some interesting/disturbing truths. Post them on your facebook ... share them with friends. Or otherwise get that info out there. sighs. Even if it's in lame forum posts. So that more people know what's going on.

Here's one small related fact to what Im talking about,

Article I Section 10, Clause 1 of The Constitution of the United States (A.D. 1789) declares in part that “No State shall make any Thing but gold and silver Coin a Tender in payment of Debts.”

Not worthless paper backed ( aka ) fiat currency, ... printed and controlled by private central bankers and banking cartels.