http://www.etax.com <br /> <br />Anyone who is self-employed has likely received a Form 1099-MISC at some point in their career. Even if you are self-employed for a part of the year, you will receive a 1099-MISC from each client who paid you in excess of $600 during the year. Basically, this form is similar to a W-2, except it applies to those who work for themselves. On this form, you’ll need to pay close attention to the amounts reported in Box 7, Nonemployee compensation. <br />Income for self-employed individuals is classified by the IRS as any money received from a company with whom you are not an official employee. <br />When filing a return, you are required to include amounts from Box 7 of 1099-Misc onto Box 1 of Schedule C, Profit or Loss from Business, with your Form 1040. <br />Running your own business can get expensive, but luckily there are some costs that can be deducted. Most expenses can be deducted in full, however some require long-term deduction. This type of deduction is called “capitalization”, and requires you to deduct a percentage of the expense each year, for a specified number of years. <br />Any deductions must be deemed necessary, and can’t be uncommon. The expense must be typical to your industry, and required to help your business run smoothly and efficiently. <br />If you have profited from work or your business, you may be subject to a self-employment tax, which includes Medicare and Social Security taxes. To determine the amount of the tax you have to pay, file Schedule SE, Self-Employment Tax, with your regular return.
