In today’s technologically connected economy, it is possible to perform practically any job as a freelance worker and employers all over the world are beginning to realize the benefits of outsourcing some of their workloads to them. Due to this, the demand for freelance workers in the marketplace is steadily on the rise.
Knowing that work is in high demand is terrific news for all types of freelancers. This means that there are many work opportunities to discover no matter what type of service you are offering.
Before you can start searching for some of these jobs, however, it is important for you to decide what kind of freelancer you are – or what kind you want to be – if you haven’t already. This goes a little bit beyond simply deciding what type of service you’d like to offer your potential clients.
Choose Your Availability
It is important to be aware of how much time and energy you can devote to your freelance endeavors. Now is when you need to figure out whether you’d like to offer your services on a part-time basis or if working on a full-time basis would be better suited for you.
This decision depends on the service you’d like to offer clients–since some types of jobs would require more time and energy than others would–as well as keeping in mind what your particular financial needs are.
Taking the time to schedule downtime for yourself is just as important as figuring out your availability needs. While making as much money as you can might be your goal, without the proper downtime scheduled it can be easy to get burned out from working too much.
The great thing about freelance work, though, is the fact that it can be as flexible as you need it to be. This means that deciding how to set your availability is really easy to do once you know what type of job you will be performing.
Legal and Corporate Structuring
Knowing how to legally structure your business can be confusing for many entrepreneurs. There are differences in requirements across states. And the language used by the Internal Revenue Code can be at best challenging to grasp.
For an average small business, the LLC or the S-corp will be the best bet.
Here are the basics of an LLC, which is typically simpler to incorporate and easy to understand.
- A single-member LLC reports business activity on its personal tax return
- Most LLC forms are short and easy to understand
- LLC owners have to pay self-employment tax, divvied up into quarterly payments to the IRS
And here are the basics of the S-corp:
- It pays its employees a reasonable salary and covers payroll expenses
- Any remaining profits can then be distributed to the owners as dividends
- The benefit is that dividends are taxed at a lower rate than income
Both LLCs and S-corps can deduct expenses such as advertising, travel, car expenses and more. That can help lessen the tax burden. Business owners aren’t necessarily limited to choosing between the LLC or the S-corp. An S corp can have better tax advantages, but if you’re going into business with a partner, there’s no reason you shouldn’t choose an LLC.
The Choice Is Yours
As a freelance worker, how you present your freelance business to your clients is purely up to you. Remember, you didn’t get into freelancing to work 80 hours a week. So ask yourself, what kind of freelancer are you?