“Independent contractors are virtually everywhere. There are more than 10 million of them across the United States — more than 7 percent of the total workforce. They are essential to our economy, accounting for $473 billion in personal income, or $1 of every $10 earned in the nation.”[i]
The commonality of IT Consultants working as Independent Contractors is increasing, and this is only one area where growth in the realm of Independent Contractors is on the rise. The practice of IT Consultants working for themselves as contractors has many enticing features like the potential for higher hourly rates compared to their employee counterparts and greater flexibility in scheduling work hours which has a positive impact on the work-life balance.
We work with many IT consultants all across the country and one question we hear all the time is “What can I deduct?” This is a great question because it can impact your taxes in a big way at the end of the year.
The following are common deductions from taxes of IT consultants:
Home office, including a portion of your:
rent or mortgage
homeowners or renters insurance
utilities
home security
maid service
Auto & travel
Cell phone
Internet
Meals & entertainment
Equipment (computers, etc.)
Software
For more in-depth list of possible deductions click here.
[i]Heiman, Alice 2014. “Independent Contractors a boon for U.S. economy.” Las Vegas Review-Journal (February)
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