Welcome to The Loaf - a weekly newsletter sharing money and business tips for creators & freelancers
Business: How to make career decisions as a creative [blog]
You're going to make many significant decisions throughout your career.
Deciding whether to go full-time or remain part-time, staying solo or partnering up with someone, and choosing where to live are just a few of those scenarios.
When it comes down to it, Daren says that "the right decision often is the one that has the least amount of friction".
Money: The Dangers (And Advantages) of Buy Now Pay Later Services [article]
This week, Apple announced their own Buy Now Pay Later service. That means that anyone who uses Apple Pay will be able to make a purchase and rather than paying in full, you can split the cost over 4 equal payments with no interest and no fees.
Buy Now Pay Later can be an amazing alternative to credit cards, but it must be used carefully or you'll end up getting yourself in a financial bind.
Question of the week: Is internet money taxable?
Yes. And absolutely not.
I saw this question on a forum the other day and had to write about it.
As a general rule of thumb, if you receive any sort of income, it has to be reported when you file taxes. Failure to do so can result in penalties, fines, and sometimes even jail time..
For the example above, YouTube is required to work with IRS to gather necessary tax info from creators. When you enter the YouTube Partner Program, you should be prompted to provide your tax information, which would similar to how a freelancer has to fill out a W-9 form when working with clients.
YouTube will then take the information that you provided, apply it to the revenue you earn on the platform, and then send you a 1099 form at the end of the year to your address on file. That information is then used to help file your overall tax return.
If you don't give YouTube your tax info, they will typically withhold 24% of your earnings.
Because your individual tax rate will vary, this 24% may be more than you should actually be withholding.
For example, if you're single and earn less than $41,755 in 2022, your tax rate is only 12%.
Or on the flip side, if you earn over $170,000, your tax bracket jumps up to 32% and the standard 24% withholding wouldn't be enough - meaning you may have to come up with extra funds come April to cover your tax bill.
Because taxes are complex, and tax law varies from state-to-state and country-to-country, I highly recommend working with an experienced tax professional (CPA or EA) to make sure that everything is being reported and filed properly.
The cost of tax prep & filing is negligible compared to the tax savings and potential mistakes that it can help avoid.
🙏🏼 How to ask for payment politely (+ an easy email you can copy)
💰 9 things Josh Spector has learned from selling $100k worth of products through his newsletter
🎥 A video for every creative person ever
✍🏼 Most social profiles aren't very good. Here's how to fix yours.
📈 9 common traits that create successful products
Freelance Finds: 3 Reasons Freelancing Makes Me a Better Parent