On top of that, you can take advantage of many tax write-offs with your independent contractor status. With accurate records, you can readjust your driving habits or find another solution to minimize fuel consumption. For example, you may be spending too much money on car fuel. Saving moneyĪnother aspect of creating or using a spreadsheet for cost tracking is finding the points where you might be overspending. Your expenses sheet template is a record book of all your business costs, allowing for reliable tax filing. You’re essentially running a business, highlighting the importance of regular and accurate cost tracking to ensure you pay your taxes correctly and have a good opportunity for further investment. While being your own boss seems great, one caveat you might not like is that you have to cover your own working costs. Benefits of Using a Tax Sheet Template 1. You can save this in your Google Drive for years, as required for any audits. Just go to the file menu and choose “download”. Once you’re done for the year, you can also save your document as a PDF. Also, confirm that you entered the correct amount, as the numbers under this column are summed up according to the category in the Summary tab. Amount: Update the amount per expense, ensuring that it matches your receipts and invoices.For example, you can say it’s a payment for your employee or their work benefits. Expense: Write a detailed description of your costs.Merchant: Enter the merchant name where you bought a product or paid for a professional service.Simply click on an item from the menu to confirm your choice. Schedule C Category: Under this column, you’ll find a dropdown menu of items that fall into a particular category in Schedule C.Note that this column only accepts valid dates and will reject other kinds of input and date formats. Simply enter the date using the following format: MM/DD/YYYY. Date: Keeping track of your expenditures lets you trace your expenses to the penny.Let’s take a look in more detail at how to populate your numbers: Here, you must select an item from the dropdown menu of categories. To produce a summary of your expenses, you need to input the specifics of your costs into the Schedule C Category column. This is a sum of all the tax-deductible amounts of the categories listed. Tax Deductible Amount: The numbers here are automatically calculated by multiplying your gross amount per category and business use percentage.Īnother handy feature you’ll see once you scroll down the template is the Total Tax Deductible Amount.The IRS has a simplified option for calculating this. Home Office Deduction: Be sure to read up on your home office deduction, too.If you leave it blank, it defaults the value to 100%. You can modify this column by inputting the equivalent percentage you used solely for business purposes. % Business Use: Some expenses you make may be partially for your business operations, like your auto costs.Take note that it presents the sum for each category. Total Amount: This column automatically gets updated as you list your expenditure numbers under the Expenses tab.This column organizes your expenses more clearly, letting you know where to save money. Schedule C Category: The categories in Schedule C determine what you can and cannot write off from your taxes.Its purpose is to let you navigate your costs more quickly to ensure that you’re putting the right amount in the correct category. Line: The numbers under this column correspond to the various categories of Schedule C.There’s no need for you to edit this section, as the spreadsheet formulas will automatically do the calculations for you.
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This tab features five columns, presenting a quick overview of your costs as an independent contractor. Let’s explore these in more detail below. There’s also the Expenses tab where you can enter the figures of all your payments and purchases. After opening your copy, you’ll see the Summary tab, which includes the total amount per category and the possible tax deductions you can take. Our template is simple, containing only two tabs that you need to use to track your business expenditures. How Do Independent Contractors Keep Track of Income and Expenses?Įxploring Our Free Independent Contractor Expenses Spreadsheet How Do I Report Independent Contractor Expenses?
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Common Independent Contractor Tax Deductions You Shouldn’t Pass Up.Exploring Our Free Independent Contractor Expenses Spreadsheet.