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Tax Tips Designed for Internet Marketers

April 7, 2011 by  
Filed under Affiliate Marketing

When you earn money by means of your Internet Marketing efforts that money counts as income. That income must be reported to the IRS and you also need to pay taxes on it. Sadly, the money you generate on the web is not exempt from taxes. Don’t trust any person who makes an attempt to tell you anything that is different. You don’t want to get into trouble with the Internal Revenue Service do you? There are few things worse than getting audited! Of course, if you’ve never needed to handle your own taxes before, figuring out how to track your income and expenditures and what you owe could be very confusing. Use the following advice to assist you.

It is amazingly important that you record the amount of money you make. The documents need to have a lot of details in them. Every solitary payment you obtain, who pays it and what it is for must be written down and recorded. The date needs to be included for each payment as well. You can use a method like QuickBooks to keep track of these details for you or you can set up a system of your own. For a lot of people, a simple Excel spreadsheet functions the best.

Don’t just toss out these records right after your taxes have been submitted. It is very important that you keep them available for a minimum of three or four years just in case an IRS agent wants to see them. Some could say that, after a few years, if you have not already been audited, you will probably be fine but make sure of the rules for your own state before you toss anything.

Keep all of your receipts and invoices for your expenses. When you earn a living in IM, there are a lot of items that can be deducted from your taxes. The price of managing your website, for example is usually tax deductible. Money you spend on office supplies also can usually be deducted. Do you go to seminars? Check to see if your traveling expenses and the cost of the conference may be deducted. Sometimes even most of the money you set toward your internet bill might be deducted as well. It is essential to keep records and copies of all of your receipts and charges so that you can prove what you have spent.

Pay toward your taxes over the calendar year. What you do is technically called freelancing and most freelancers will submit quarterly tax payments so that, when the end of the year comes they will not owe as much. A good guideline is 30% of your income for that quarter. The IRS currently has a procedure that should let you make payments as often as every month. Track every single payments you make and retain copies. When it comes time to file your annual tax return, if you’ve accidentally sent in too much money, you’re offered a refund in the amount that you have overpaid.

There are plenty of ways to make your taxes simpler to handle when you work in Internet Marketing. The IRS’s website has a wide range of beneficial hints that you can use to streamline your book keeping and tax prep. You might also consider, if you have the money, employing an accountant to take care of all of that for you..

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