I just started working in the middle of janurary of this year and i was wondering would i pay taxes this year or would i pay them next year. i'm a freelancer so i know i'm taxed differently
Do you have an established business ( on paper ) or you going to report this on your personal taxes? Can I assume you're in the US? Under most arrangements the little guy pays on a Jan 1 - Jan 1 schedule. So even though you'll probably do your taxes in April and you've already made some money by then, you made it in 2007, and you're paying taxes on 2006 income. You can do accounting tricks to change that, but by default that's how it works. And this isn't tax advice, by the way; I'm an IT guy.
it'll be reported on my personal taxes. and yes i am in the us. i earned nothing in 2006 though. i'll do some research to see how it goes exactly. thanx for the help btw
Yes, as a private individual, you basically report last year tax this year. That way you will know how much you make for a full year. If you read the tax return form http://www.irs.gov/pub/irs-pdf/f1040.pdf?portlet=3 , it reads Jan 1 - Dec 31 2006 so that should mean you only file last year tax this year and this year tax next year and so on.
your jan 2007 taxes are due in 2008... And as a freelancer, setp an scorp to avoid double taxation of an LLC and such.
It should have been S Corporation, basically it is a corporation which does not pay corporate tax. Instead the shareholders would pay the income tax based on the shares they have in the company http://en.wikipedia.org/wiki/S_corporation