Have you ever wondered why there’s no dedicated personal finance book for independent workers? Authors Joseph D’Agnese and Denise Kiernan did, so they wrote their own, entitled, “The Money Book for Freelancers, Part-Timers, and the Self-Employed” (Random House/Three Rivers Press, 2010. In stores now.) Most people know them from their hilarious book trailer. In this guest post, they share their secrets to a stress-free tax season. Have a story you'd like to tell to other freelancers? Email us at firstname.lastname@example.org. All our traditionally employed friends get bent out of shape at tax time, like it’s some big deal. Well, tax time comes four times a year for freelancers. The trouble is, most of us don’t know it. While traditionally employed workers have taxes taken out of their pay automatically, freelancers do not. To be successful, independent workers must look at their income in a whole new way and have to commit to doing it year ‘round. Here’s how we manage to make it work. 1. Mark Your Calendar Don’t wait until April. Independent workers are responsible for paying estimated taxes June 15, September 15, January 15 and of course, April 15. Remember: April 15 is a double whammy. You pay not only the annual taxes for the prior year, but the first installment of estimated taxes for the current year as well. * 2. Get Organized* Organize your finances as any responsible business would. If you are not already, begin tracking income and expenses down to the penny. Receipts are your friends—never let them slip away. Financial software programs—such as Quicken or mint.com—can take some of the pain out of this chore. * 3. Commit Yourself * Employers take a percentage out of workers’ paychecks to send to Uncle Sam. You must do the same. Commit to taking a percentage out of each and every check and save it in what we call a Tax Savings Account. Not sure how much to take out? Look at your previous years’ tax returns (state, federal and city, if applicable). Take the tax you paid each year and divide it by that year’s gross income. Multiply that number by 100. This will give you a ballpark percentage that you can start taking out of each check. This number varies freelancer to freelancer, so mind your own business—not someone else’s. * 4. Stay on Track* Making more this year than in years past? Less? Then the amount you’re setting aside for taxes will need to be adjusted. On a quarterly basis—when you pay your estimated taxes, for example—look at what you’ve earned so far and decide whether to adjust your percentage accordingly. The more regularly you do this, the better you will get at on-the-fly financial housekeeping. 5. Get Help Seeking the quarterly counsel of a tax pro is worth every penny, and not as expensive as you think. Shoot ‘em an email detailing your quarterly earnings, and they should be able to tell you about how much estimated tax to pay and how much to invest for retirement. What could be easier? 6. Divide and Conquer Don’t allow money destined for the Tax Man to mingle freely with money waiting to be taken out on the town. If you don’t want your tax bucks to end up spent on a beer tab, you must set them aside in what we call a dedicated Tax Savings Account. We recommend using an online bank with limited—or better yet, no—ATM access. That way the money goes in and stays in until it’s time to pay up. One of our mantras is “ABA”: Always be analyzing. Cultivate a quarterly habit of taking stock of where you are financially. If you do this, April will be a time to celebrate your financial savvy, not scramble to scrounge for what’s due. Don’t you owe it to yourself and your future? You can reach Joseph D’Agnese and Denise Kiernan, authors of “The Money Book for Freelancers, Part-Timers, and the Self-Employed: The Only Personal Finance System for People With Not-So-Regular Jobs” (Crown/Three Rivers, 2010), at info AT feed-the-monkey DOT com. Follow them at http://www.facebook.com/TheMoneyBook.