We’re just over 9 weeks away from the new year. And while there are many enjoyable holiday traditions to look forward to, there are also some not so fun ones—like end of the year taxes.

We know what you’re thinking…But taxes aren’t due until April 15th! And while you’d be right in thinking it, you’d be sorely misguided if you didn’t consider the end of the year as an important time for taxes. Dec. 31st is the deadline for most tax breaks and it’s a crucial time to increase deductions so you can decrease your taxes. If you wait until the new year, it will already be too late to capitalize on big deductions!

Here are 4 end of the year tax tips to help freelancers start off 2016 with a bang:

Invest in Your Skill Set Before the End of the Year

Want to improve your business skills? Need a programmer but can’t afford one? Now’s the time to go to that web developer boot camp or that small business conference in Vegas. These business related courses will be tax deductible so long as you do them before 2016. Not only will you be turning yourself into an entrepreneurial ninja, you’ll be saving money while doing it.

Invest in Your Business

Now that you know the benefits of investing in yourself, it’s time to consider investing in your business. In the next few weeks, consider boosting your marketing presence and increasing your ad space. These things will allow you to increase deductions while growing your business.

Invest in Assets

Investing in assets is a great way to increase productivity while (yup, you guessed it) decreasing taxes. By making smart investments you can turn those assets into a profitable ROI. Assets might include things like new computers, office furniture, and equipment. And so long as your business is profitable—you can write off 100% of those assets.

Side Note: As the law stands, assets can be deducted up to $25,000. Be aware however, that last year Congress waited until Dec. 14th to pass Section 179 of the Federal Tax Code. Section 179 retroactively changed the amounts of deductible assets to $500,000. It’s entirely possible that the process repeats itself this December.

Pay Your Quarterly Estimated Taxes

Paying your quarterly estimated taxes might seem straightforward, but with the April 15th being the seminal date for taxes—business owners often forget about keeping up with their quarterly estimated taxes.

The final day to pay estimated taxes is January 1st, so make sure you pay them on time to avoid penalties. Most freelancers are cash basis taxpayers which simply means they report income and deductions in the same year that they receive them. If possible, you should try and get your clients to pay out in January. By being paid in January rather than December, you won’t have to declare that income on your taxes for another year.

Austin Miller is the Content Marketing Ninja at Bookly, an online bookkeeping service designed for small business owners. Bookly pairs you with a dedicated bookkeeper and software so you spend more time doing what you love.


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