Disclaimer: This is my personal opinion and experience, and is not to be taken for legal advice.

Taxes can sound incredibly complicated and expensive. But they don't have to be. Especially with all of the resources that are out there these days.

1.Put Aside Money From Each Job
Each job you make, set aside a certain percentage of it. People will throw different numbers around, but I personally set aside 25% of the money I make from every job to pay for taxes. That way, when tax season rolls around, I have it.
Why 25% when my income tax bracket is lower than that? Being self-employed you have to pay self employment taxes (which a employer would usually be paying and setting aside from your paycheck) on top of your income taxes. 25% is a little higher of a number than you may end up needing, but it gives you wiggle room. After you've filed your taxes any extra money you paid that you didn't need to, you'll get back. Yay!

2. Keep Good Records
Keep good records of your total income, who has paid you what, and all business expenses (and the receipts to prove it!). When tax time comes around you'll report what you made, and what you had to spend to run your business (which brings about tax deductions! Yay!)
If you've got good records, all you will have to do is plug the numbers in.

3. Submit Quarterly Estimated Payments
If you think you'll owe more than $1000 in taxes this year, you may need to be making estimated tax payments. If your business if your only income, and you're making at least $7,000, you'll definitely need to submit quarterly estimated taxes.
No matter what your scenario, it's a great thing to double check. I love the Turbo Tax TaxCaster tool. Simply put your information in, and let it do the rest. If the Fed Tax Refund meter is negative by over $1000 you'll need to pay estimated taxes.
How to pay estimated taxes? 
a) You'll need to start with the Form 1040-ES
b) Then each quarter, use the vouchers at the bottom of the form to submit your estimated taxes.
c) Rather than completing their estimation form, I personally send the total of the 25% I've been saving from each shoot that quarter. The IRS likes equal estimated payments, but they also like enough of a payment, so if your payments aren't equal but you've paid enough taxes it shouldn't be too big of a deal.
d) Send a completed voucher, along with a check with your estimated payment to the IRS by mail. Make sure you send the form to correct mailing address (that can be found on page 4 of this year's 1040-ES packet).
e)Be sure to follow all instructions also listed on page 4.

4. Pay Sales Tax Each Quarter
Make sure you are submitting quarterly sales tax if your state requires it. In more and more states photographers have to charge sales tax, even if the client is just paying for digital files and not a tangible product. You'll have to look up your states rules and regs on this. To read more about applying for a sales tax permit check out this article. The sales tax amount you charge is usually equal to whatever local sales tax your town has to charge. Just check the bottom of a receipt of a recent purchase if you don't know what that is.
Every quarter you'll log back in the same website, and pay the amount of sales tax you have to collect. Beware, different states often have different quarterly due dates than the IRS estimated tax payments. So make sure you don't get them mixed up, otherwise you'll face late fees.
Also, even if you don't make ANY money, you have to fill out the quarterly sales tax form once you have that permit. You'll just signify on there that you made 0.

5. Use Turbo Tax To File Your Taxes
Turbo tax was one of the best things that happened to my business. Starting out I didn't have the budget to pay an accountant or CPA to file my taxes. Turbotax only costs $80 for small business, and they do an absolutely beautiful job. As long as you've got all your numbers together, it's a walk in the park to just plug things in as they ask and prompt you. Along the way Turbotax provides a lot of explanations too so you make sure you're putting the right thing in the right place.


Paying taxes is an important part of running a business the right way, but it doesn't have to intimidate you.

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