An employer identification number (EIN), or business tax ID, is a unique nine-digit number that you use when filing taxes for your business. An EIN also helps you register a business entity, obtain a business loan, open a business bank account, and much more. An EIN is as important for your company as a social security number (SSN) is in your personal life.
If your tax returns are complicated and you suspect you’re leaving money on the table, it may be time to get help. There are plenty of professional tax preparers out there, including certified public accountants and tax attorneys that can help you navigate tax laws and get a bigger return, if not a lower bill. If you do decide to go pro, be sure to vet any tax preparer you consider. The Internal Revenue Service offers tips for choosing a tax preparer.
WHEN IT COMES TO stretching your budget, working a side hustle or part-time gig is an effective way to ensure you're earning enough to cover your expenses. But here's the rub: Your side business carries repercussions for your taxes.
"People who have been doing side gigs usually owe [taxes] and are surprised and shocked that they owe," says Nayo Carter-Gray, an enrolled agent at 1st Step Accounting in Baltimore. Freelancers should prepare for the very real tax results of essentially running a side business, she says. "I tell my gig workers to consider themselves mini-franchise owners," Carter-Gray says.
Freelance work was once considered something you did on the side to make some extra cash, explore a new field, or develop a new skill. Today, it’s an opportunity to turn your passions into a long-term, lucrative career. With 53 million people working as independent workers and growing strong, this segment will make up 40% of the workforce by 2020.
These folks aren’t working on their own because they have to. In response to a survey conducted by Contently, more than two-thirds said they plan to keep it up for at least the next 10 years.
Doing this full-time offers you the chance to build a business doing the work you love most, from wherever you want. I should know: I founded CloudPeeps, a talent marketplace matching businesses with the world’s best freelance content, community, and marketing professionals.