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My accountant told me to set aside 40% for taxes from every freelance check, and I thought it was too much.
I used to just guess, and last April I owed almost $8,000 because I hadn't saved enough. Now I have a separate savings account just for tax money. How do you handle your tax payments to avoid a big surprise?
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shane_fisher3720d ago
Sounds like a lot to put aside, but maybe your guy knows your specific numbers. That separate account is smart though, stops you from spending what isn't really yours.
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garcia.tyler20d ago
Just look at last year's tax bill and divide it by twelve.
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the_simon20d ago
Yeah, that separate account is key. But how do you actually figure out the right amount to put in there? Is it a flat percentage of every check, or do you adjust based on what jobs you have lined up? I always struggle with that part.
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