Being your own boss is liberating. You set your own hours, choose which clients you want to train, and have the freedom to work anywhere in the world. But wait. As a freelance personal trainer, you also have to file your own taxes. So, what can you claim on your taxes?
As an independent personal trainer, filing your taxes doesn’t have to be difficult.
We put together a few tips to make filing your taxes as easy as your first set of squats.
When it comes to filing your taxes, being organized is what matters most. Accurate record keeping is the most basic form of staying organized. Having a thorough understanding of where your money is going helps you plan for long-term goals more effectively.
The best place to start is with your income and expenses. Start by putting all of your receipts in a folder or by creating a spreadsheet on your computer. There are also a lot of online applications you can use to keep track of your expenses.
– Separate Your Business and Personal Expenses
As a sole proprietor, it may not seem necessary to separate personal and business expenses. But if your company is an LLC, it’s mandatory. By doing so, it’ll be easier to track all of your deductible expenses. If you choose to organize your finances online, don’t forget to keep the hard copies in a file. When tax season rolls around, you’ll want to double check everything before you submit your tax return.
Personal Trainer Write-Offs
Once you have a handle on the basics of organization, the fun can begin! Yes, saving money makes everyone smile. As a personal trainer, you can keep more of what you are earning by claiming deductions, otherwise known as tax write-offs. So, what are standard deductions a personal trainer can claim?
– Home Office
You don’t need to designate an entire room to cash in on this tax deduction. It can be as simple as a desk in the corner of your bedroom. Then you take the square footage of that space and divide it by the total square footage of your home.
You can also write off any supplies you use, including:
- Your computer
- Cell phone
- Stationary items
- Your electric bill
- Fax machine
Just make sure you keep accurate records of how much you spent, with the receipts safely filed away, in case you’re audited.
Train Anyone, Anywhere in the World.
The easiest way to deduct mileage is to take the standard deduction, which is an amount predetermined by the IRS. Alternatively, you can deduct your car expenses for the year, which include gas and maintenance. If you choose to go this route, you’ll need to keep track of the mileage and all other expenses. Whichever you choose, keeping the hard copy of receipts in your file will save you time and possibly money if you’re ever audited.
You can also write off continuing education courses (in person or online), books, and fitness conventions. Business-related educational tools qualify as a deduction, so even if you pay for a mastermind group, this probably qualifies as a tax deduction.
Business lunches also qualify as a tax write-off. You can claim purchased meals while attending fitness conventions and/or continuing education classes. Typically, you can claim up to a 50 percent deduction.
– Other Purchases
Although not exhaustive, the following should give you an idea of what else you can write off when tax time rolls around:
- Exercise equipment used for business purposes
- Work attire
- Health insurance
- Music used to teach both private and group sessions
- Retirement Plans
As long as these purchases are business related, the sky is the limit. If in doubt, check with your accountant or tax professional. As your own boss, you are responsible for filing your taxes every year.
And although it can seem overwhelming, it doesn’t have to be painful. Careful planning goes a long way when it comes to your financial health.
Getting organized before tax season hits will make filing your taxes a lot less painful.