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I consider myself lucky to call myself a solopreneur—AKA I run my own business and work for myself. But the idea of solopreneurship is so romanticized— Make your own hours! Take on the project you love! No boss to breathe down your neck! Let me assure you, it’s not all laptops and lattes at the local coffee shop. At times it can be a lonely, frightening way to make your living.
Tax time is the most frightening time of all, and often solopreneurs struggle to figure out if they’re doing everything right. I know I yearned for a “tax friend” that I could ask unlimited questions to, who could look my filing over and make sure I wasn’t messing it up in those early years.
This year, TurboTax must have heard the cries of solopreneurs like me, because they’ve launched a service I would have killed to have back then. It’s called TurboTax Live, and it combines the easy-to-use TurboTax software with virtual house calls (read: a one-way video chat) from CPAs and EAs designed to help you answer on-demand questions about your tax return, right from home. When you’re doing your taxes and need clarification on a deduction—like that home office deduction— you can simply click “Expert Help” in the upper right-hand corner to gain access to a phone call or one-way video chat (your choice) with an expert that will provide personalized tadx time tips and advice.
Oh, and you can keep your hair in a messy bun since the video is only one-way. Phew!
While you’re talking to your expert live, their notes and recommendations appear in the form of little green boxes that show you precisely where you can make adjustments to maximize your refund check.
You’ll also get a one-on-one review of your tax return once it’s completed, so you’re totally confident that you’re getting the maximum refund you deserve, and that there are no red flags before you sign and file. In fact, the tax expert with TurboTax Live can even sign and file for you if you choose. Instead of waiting until the last minute out of fear and avoidance, TurboTax Live makes the whole process feel so much less daunting and solopreneurship seem less… solo.
For me, starting a business was daunting from decision one: How to classify. I agonized over whether to set my business up as an LLC or an S-Corporation. My goal was to keep my business expenses— and liabilities— completely separate from my household, but learned that both S-Corps and LLCs accomplish those things in different ways. The more people I asked, the more confused I got— and I learned that you really can’t ask other people about this stuff since everyone’s financial situation is so different. Since I couldn’t afford a tax planner or an accountant in year one (it was just me and a very inexpensive bookkeeper), I made the best choice I could, and moved forward.
When tax time came that first year, I was horrified to find out that my business would roll up into my personal tax return (not at all what I thought was going to happen!), and that I’d be taxed at my household rate (much higher than my rate should be, due to my husband’s fabulous income). I felt so stupid for being in the dark on both of these things. While my business didn’t end up causing any financial burden to our personal finances that year (because, er… I made almost no money), I wished I had really understood how things were going to play out so I could have been more prepared. I yearned for that “tax friend” that might have been more patient with me, and clearer with answers, so there wouldn’t have been any surprises come April.
I’m much more confident all these years later: While filing taxes on your own is still a bit daunting, it’s so much easier when you know the ropes, and have resources you can lean on. These days, I have one full-time employee and myriad freelancers that work for me on-and-off throughout the year. Each time my business grows or evolves, it seems like there are new rules I need to learn and follow— and of course the tax code itself is evolving over time, so even if my business stays the same, the rules continue to change.
My biggest anxiety now is probably similar to yours: Deductions. Deduct too little and you’re leaving money on the table, deduct too much, or the wrong things, and you’ll get your wrist slapped (or worse— audited!).
I have questions each and every year: For example, did you know that you can deduct part of your mortgage and utility bills if you work from home in a designated home office? You might have, but do you know how to calculate that deduction? Right, me neither. Also, this year I bought some new laptops for the team, and a new printer, then learned that you can only deduct part of the cost of new hardware— the rest has to be amortized over many years. Business travel, co-working space memberships… it all requires a lot of counsel to get right.
Another worry? Misclassifying workers. I’m always nervous about being sure that independent contractors (writers, shooters, audio guys, or online marketing specialists I might hire) aren’t going to be classified as employees by the IRS, and therefore subject to benefits and payroll. My assistant Danielle is a legit full-time employee, but the rest of the people I work with are project-based, and how each state classifies who’s who is nebulous at best. Yet another area that I’m so glad I have counsel on when I speak to the TurboTax Live experts. Seriously, HALP.
Bottom line— whether you work solo, or just file your taxes solo, you can’t put a price on the confidence and peace of mind you get while tapping into on-demand expertise with TurboTax Live. This year I hope you’re able to file confidently, and not be queasy like I used to be, on tax day.
Stressed about taxes this year? Let me know in the comments.
This is a sponsored conversation written by me on behalf of TurboTax. The opinions and text are all mine.