The deadline for filing 2014 taxes is around the corner. Which means that a lot of people are probably still getting ready to file theirs.
For a salary-based employee, a portion of every check is taken out and given to the government to cover part of the employee's annual tax bill. If done right, you likely won't have to pay all that much come mid-April. In some cases, you'll even get some money back.
Things are slightly different with mystery shopping. Secret shoppers work as independent contractors, which could result in a significantly large tax bill come tax season. Luckily, there are ways to prepare yourself to come out on top each year.
Working on your own
If you're lucky enough to understand how taxes work on your own, use that knowledge to your advantage. Figuring out an estimate of how much would be taken out of each of your checks allows you to save at your own pace. You could set out a portion of every check to prepare for the larger tax bill with a due date of April 15.
Being in control of your own paychecks and what amount gets taken out offers a lot of flexibility when it comes to budgeting. There may be times when you can afford to set aside more money than usual, and there may also be times when it's best to save . As long as you reach your overall goal by the time your taxes are due, you can adjust your savings accordingly.
A strategy that many freelancers and independent contractors use is to pay quarterly tax estimates. For some, this many be an easier method of budgeting finances than turning in one large, lump sum toward the end of the year.
Going to a professional
If you don't understand the complexities of taxes, you may need some professional help. Filing taxes isn't easy. Navigating your way through loopholes and exceptions is another story altogether.
Paying to go through your finances with an accountant or tax specialist can cost up to around $300. When you consider not only the convenience, but the potential money you'll save, talking to a professional is a worthwhile investment. For example, understanding write-offs is something the common person can't claim as a skill. Accountants could save you money through write-offs that you weren't even aware existed. Given that you may be traveling for job assignments, you may be able to write this off as business travel expense. If you're lucky, you'll walk away with a strong return on investment.