Self-Employment Tax Deductions - Optimize Your Tax Return

In order to minimize the taxes you owe, you will want to read more about these 9 self-employment tax deductions useful for optimizing your tax return. 

1. Defer Income and Accelerate Self-Employment Tax Deductions to Avoid Higher Tax Bracket

– Take advantage of last-minute self-employment tax deductions before year end and defer income until next year.

2. Use the Self-Employment Tax Deduction

– As a Form W-2 employee, your employer pays their equal portion of payroll taxes on wages or salaries paid to you. However, when you are self-employed and you are the employer, it is your responsibility to pay both portions.

3. Contribute to an Individual Retirement Plan (IRA)

– Tax-advantaged retirement accounts can lower your taxable income and grow funds in a tax-efficient manner.

4. Contribute to a Health Savings Account (HSA)

– If you use a qualifying high deductible health plan to cover yourself or your family, you will have access to this triple tax-advantaged account.

5. Take Advantage of Educational Tax Credit

– These credits can be useful for enhancing your hard skills and growing your business while lowering the amount of taxes you owe.

6. Home Office Tax Deduction

– While the most complicated self-employment tax deduction on this list, this can be a major tax deduction to consider each year.

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