Hola! I am Ana Flores, the founder and CEO of #WeAllGrow Latina Network,
an online community of influencers, creatives and entrepreneurs.
Joining us today is Diana Castro, authorized tax agent with TurboTax Live.
She has helped clients build wealth
and retain more of their earnings by providing advanced tax reduction
strategies and mortgage planning advice for over 20 years.
She is an entrepreneur at heart
and started her first business 30 years ago.
Bienvenida Diana. ¡Que gusto!
¡Ay Gracias! Encantada de estar aquí con ustedes.
So, let's get right into it. As a content creator,
what income and expenses do I need to report on my taxes?
There's a couple that you want to keep in mind because I know as a content
creator you can receive income from a variety of different sources.
So it's important to think about
the different sources that you do receive income from in order to report those.
Some of those could include like brand partnerships.
So a lot of times you might have a podcast
or a video channel and you're receiving income from that.
And so you need to report whatever type of sponsorship you receive as income
from that, even if you're not receiving like actual dollars sometimes.
Unfortunately, anything that you receive of value or income should be included
on your taxes and reported as taxable income.
OK, Diana, the second question we have is,
what are the top three tax deductions for Soloprenuers to save tax money?
That's a great question.
So the top three tax deductions for solo entrepreneurs to save money.
I would say the first would be your retirement plans.
So this is a great way to be able to put money in your pocket to pay yourself first
and also to minimize your tax liability with the IRS and even your state.
And there's different types of retirement plans that you can consider.
One of them that I really love for solo entrepreneurs is a solo 401k.
And the reason I love this particular retirement plan for solo entrepreneurs is
because it really allows you to maximize how much you can contribute and how much
your employer, which is also yourself, can contribute to the plan.
And another key feature, which none of the other retirement plans
has is that you can actually borrow money from that plan without paying tax on it.
Typically about 50 percent of your
balance, up to about fifty thousand dollars.
This is such great advice.
And let's put money back en nuestro cochinito, first.
Exactly! Let's pay ourselves first.
This is great.
So I would say like the second top deduction would be home use.
And this is a really powerful deduction because you can take money you're already
spending and now use it as a way to capitalize and minimize your tax
liability so you can take an exclusive area in your home.
And it can be any area.
It can be part of your garage.
It can be a shed in your backyard as long
as it's exclusive use and you dedicate that to your business.
And so this can be really an incredibly,
as I mentioned, powerful deduction because you're shifting money that you're already
spending now into a tax deduction in order to maximize your deductions.
The last tip, the third tip, is probably regarding equipment.
So for some reason,
it's really easy for people to overlook, like their cell phone.
That's equipment. And all this type of equipment that you're
using in your everyday work to create content is all tax-deductible.
And you can either choose to depreciate it, meaning you're going to deduct
a certain percentage over the life of that equipment.
Or you can choose to do a Section 179 deduction sometimes,
which allows you to deduct the entire amount in that tax year.
All right, Diana. This is a question that we get a lot.
Do I have to pay my taxes annually or quarterly?
OK, yeah, that is a great question and it does create a lot of confusion for people.
So our tax system is kind of a pay-as-you-go system.
And as a self-employed solo entrepreneur,
if you're going to end up with more than a thousand dollars that you owe
to the IRS, you are required to pay quarterly taxes.
And there are the four different payments throughout the year.
So that by January 15th,
which is the last date or I think this year, it falls on the 18th,
then you must have paid your tax liability by that date.
And one thing to keep in mind is that
here at TurboTax, at TurboTax Live, we do have tax professionals available
like me all year round that can help you with your estimated tax payments.
They can answer your questions so that you've always got someone to help you.
You're not alone. So you can call and then hang up
and realize, oh, gosh, I have another question.
You can call us right back right away.
You can call us back next week,
next month, just whenever it's convenient for you.
Those are all our questions today.
Diana, thank you so much for joining us
and sharing so much valuable information for the soloprenuer community.
¡Hasta la próxima!