If you’re an LLC with a single owner, doing your own taxes is actually much simpler than you would probably expect. You don’t have to worry about a corporate tax return or any W-2’s for employees (assuming that you only use second shooters or assistants paid as independent contractors).
You might end up saving a couple bucks on an accountant, but more importantly (in my opinion), doing your own bookkeeping & filing your own taxes makes you feel more in control of your business and it gives you a much better understanding of how income taxes work and how your business is doing on a micro & macro level.
The exception: If your business reaches a level where you no longer have time for the administrative tasks, there’s nothing wrong with outsourcing tasks like bookkeeping or tax filing. If you do decide to hire an accountant or bookkeeper, make sure he/she specializes in your field, is easy to communicate with, and will be able to show/send you your info or reports at a moment’s notice.
Here’s a step-by-step checklist of all of the info you’ll need to file with TurboTax! You can download the printable version of the checklist here:
TAX FILING CHECKLIST
✶ I recommend using a bookkeeping program to track & categorize your income & expenses. ex: Quickbooks, GoDaddy Bookkeeping, Wave, Freshbooks, etc. After importing your banks, credit cards, Paypal, Etsy, or any other financial accounts, the transactions will automatically be logged. Be sure to periodically check that your transactions are categorized correctly. These categories will be important when you’re filling out the Business Expenses section on the Schedule C portion of your tax return.
⤷ Remember to start at the beginning of the year!
The BUSINESS section comes first:
☐ Your personal SSN & business EIN
☐ All 1099-MISC’s you’ve received:
• Any non-salary/non-employee freelance work you’ve done, exceeding $600 within the year. The employer will ask for your EIN/SSN & mailing address.
⤷ You’ll be receiving these throughout the month of January – collect them in a folder until you’re ready to file your taxes. ✶ If they don’t send you one, that’s their mistake, not yours! Just enter the $ amount as part of General Income.
☐ General Income → All other income excluding anything you reported in the 1099-MISC section. They only require a sum of all of this income but I like to make sub-categories for weddings, events, portraits, etc. for my own purposes.
☐ Transportation Expenses:
• Total miles driven in 2018 (both business & personal)
• Miles driven for business in 2018 → you can use an app like MileIQ!
• Tolls paid during business driving
• Public transportation expenses (train tickets, subway, PATH, etc.)
• Parking fees (parking meters, parking garages, etc.)
I recommend not tracking gas & vehicle expenses and instead taking the IRS’s standard mileage rate of $.535/mile.
☐ All 1099-MISC’s you’ve issued:
• Any non-salary/non-employee freelancers (second shooters, interns, assistants, etc.) who have worked for you & received $600+ within the year.
⤷ You’ll need to know their full company name (if applicable), EIN/SSN, and mailing address. (You can collect all of this by sending them a W9 to fill out.) You’ll need to fill out a 1099-MISC form for each worker and mail a copy to the IRS and the recipient by January 31st.
☐ Any [non-medical] insurance paid for your business that year → liability insurance, equipment insurance, etc.
☐ Advertising expenses → Facebook/Instagram ads, brochures, business cards, web hosting/blog expenses, logo design, etc.
☐ Office expenses → equipment, stamps, flash drives, software subscriptions, etc.
☐ Supplies → boxes, packaging, printer paper, ink, pens, post-its, planner, etc.
☐ Other expenses → Paypal/bank/ATM fees, courses, workshops, client gifts, etc.
☐ Home Office Expenses:
⤷ If you use part of your home solely for business (not common areas like
kitchen, bathroom, hallways, etc. – only office, desk, studio, etc.)
• Square footage of the whole home
• Square footage of business only area of the home
• Percentage of time you conduct business inside vs out of the home
• Expenses relevant to the whole home – mortgage interest, property taxes, condo insurance, utilities, etc.
☐ If you have a SEP IRA set up for your business, it’ll let you know the max you can contribute to the account (due to be deposited 4/15) – the more you contribute, the more your taxes will go down (roughly 15%).
Next up, the PERSONAL section:
☐ Any 1099-INT’s you’ve received → from banks, brokerages, etc.
☐ Any 1099-DIV’s you’ve received → from investments, retirement
⤷ Banks may mail or email these to you, or post them on your account under “Documents”, Tax Documents”, “E-Documents”, etc.
☐ Any additional [personal, not under your business] 1099-MISC’s you’ve received for miscellaneous freelance/subcontractor work (associated with your personal SSN, not your business EIN)
☐ 1099-K → if you’ve received one for third party network transactions
☐ 1099-G → if you’ve received unemployment or local income tax refunds, etc.
☐ Property tax information
⤷ If you entered this info under the Home Office section, it’ll carry over the info & give you the proper deduction for the non-business portion of your home.
☐ Any charitable donations
⤷ You’ll need the name of the 501(c)(3) organization and $ value of the donation.
☐ Any 1098-E or 1098-T’s → tuition, student loans, etc.
☐ Any medical expenses
☐ Estimated Taxes → Each quarter, you should’ve been filing a Form 1040-ES and submitting your estimated taxes. Just take last year’s federal tax due and divide by 4 – pay these equal amounts by the 4 quarterly due dates throughout the year. You can file online at sites like pay1040.com, etc.
⤷ Enter the quantities you paid and the dates submitted → don’t include any online credit card fees you might have paid for filing/submitting.
☐ Retirement/Investments → ex: ROTH-IRA – if you’re financially able to, you should consider contributing the $5500 maximum – it isn’t taxed when you take out the funds when you retire! (due to contribute by 4/15)
☐ Any moving expenses, accountant fees (or the price of the TurboTax software!), etc.
That’s it! Not so hard, right?
E-file the tax return Form 1040 through TurboTax.
You can pay the federal tax due via a site like pay1040.com, etc. (There’s a 1.87% fee but if you have a 2% cash back credit card, it’s worth it!)
Pay the local/state tax – you can mail in the voucher or pay online on the state website.
For single owner LLC’s, I recommend a program like TurboTax Home & Business:
Happy Filing! You can download a printable version of the checklist here: