EmilyGF Posted August 15, 2017 Share Posted August 15, 2017 Hi all, Does anyone here freelance? I just got a short term freelance job (that I sort of hope leads to other ones). Do I need some sort of business bank account? Or can I just have the company pay me directly to my normal bank account? I'm considering buying some software for the business, which would give me a deductible expense. Do I need an account for that? Would I be loaning myself money for it? I know people aren't accountants here, and I'll get professional advice if things grow. But I need to determine whether to give them my personal account info for transfer tonight! Emily PS It is totally legit and NOT a MLM - a true career job in the future if I want it to be. People go to college for this. Quote Link to comment Share on other sites More sharing options...
ILiveInFlipFlops Posted August 15, 2017 Share Posted August 15, 2017 I never did anything special to separate my work money from my personal money when freelancing, and I don't now that I'm self-employed in a long-term gig. All I did was keep receipts for deductible expenses and good records. If you were to incorporate, you'd probably need to do something like that, but just for freelancing/self-employed--I wouldn't worry about it. Quote Link to comment Share on other sites More sharing options...
MBM Posted August 15, 2017 Share Posted August 15, 2017 SKL is an accountant, IIRC. Taxes were the tricky part back in the day when I was technically an independent contractor and not a freelancer. 1 Quote Link to comment Share on other sites More sharing options...
creekland Posted August 15, 2017 Share Posted August 15, 2017 You have to keep really good records, but it's fine. Hubby is self-employed. He has a business account for most things, but occasionally has to use ours for one reason or another. It's never been a problem as he keeps all of his business records to keep taxes straight. 1 Quote Link to comment Share on other sites More sharing options...
creekland Posted August 15, 2017 Share Posted August 15, 2017 ps You might not want to give out your personal bank account number just in case the other site got hacked. Just a thought. Hubby never transfers any money into our account directly from a client. He might deposit a check or two, but nothing involving giving them our bank account number - even while freelancing. 3 Quote Link to comment Share on other sites More sharing options...
EmilyGF Posted August 15, 2017 Author Share Posted August 15, 2017 Oh, I wish I didn't have to give out account info, but it is a European company and they gave up checks back int he 1990s! They may use PayPal, though. Emily Quote Link to comment Share on other sites More sharing options...
MommyLiberty5013 Posted August 15, 2017 Share Posted August 15, 2017 As a banker/loan officer in prior life, we did generally advise people (even free lance sole proprietors) to open separate accounts for personal and business. The titling of the checking account for your business would likely be something like "EmilyGF DBA EmilyGF Freelance." DBA stands for "doing business as." I was always taught in business to keep it separate from personal. I personally always limit who or where gets my main checking account on record. Fraud on that would paralyze our family's finances. I've seen it happen to others while I was on the job - it can be serious. I've seen mortgage payments bounce because fraudsters took money. It can take a bank 1-2 weeks to research these matters. In that time whole bills go unpaid. If you give a business account instead, then if fraud happens there at least you've buffered your main financial stay on that main primary checking account. I wouldn't do it any other way if it were me. 2 Quote Link to comment Share on other sites More sharing options...
Bootsie Posted August 15, 2017 Share Posted August 15, 2017 You do not need a separate checking account. If you have enough transactions, you may find it helpful to maintain a separate account for accounting purposes. I have some freelance and consulting income and do not keep a separate checking account. I do have a credit card that I try to place all of my business related expenses on so that it is easier to separate things and keep track come tax time. 1 Quote Link to comment Share on other sites More sharing options...
kiwik Posted August 15, 2017 Share Posted August 15, 2017 I have just opened a separate account. That way I have an account just to be paid. I will also use it to keep money set aside for taxes so I don't spend it by mistake. 1 Quote Link to comment Share on other sites More sharing options...
G5052 Posted August 15, 2017 Share Posted August 15, 2017 I've been freelancing for some ten years or so. Even now, about 1/3 of the income I earn is from freelancing. The folks I work for send me a MISC-1099 at the end of the year. Even if they don't do that, you have to claim that income. Keep good records, but a spreadsheet of payments and expenses is fine. I used QuickBooks early on, and just keep it all in a spreadsheet now. Because it counts as household income, you may need to adjust tax withholding on other streams of income and/or set up withholding with the IRS and your state. I make enough that I have to do that. I have a separate bank account, but at times it mingles. 1 Quote Link to comment Share on other sites More sharing options...
Valley Girl Posted August 15, 2017 Share Posted August 15, 2017 CPA strongly advised me to go the separate route even though I didn't have a large number of business-related transactions. 1 Quote Link to comment Share on other sites More sharing options...
Wheres Toto Posted August 15, 2017 Share Posted August 15, 2017 I never set up a separate account for my freelancing because it never amounted to much in number of transactions or in dollar amount. Most bank accounts around here charge fees if you have a balance below $1000. We have fee-free checking for our personal accounts and I wasn't willing to pay the fees for the limited amount of freelancing I was doing. 2 Quote Link to comment Share on other sites More sharing options...
creekland Posted August 15, 2017 Share Posted August 15, 2017 I never set up a separate account for my freelancing because it never amounted to much in number of transactions or in dollar amount. Most bank accounts around here charge fees if you have a balance below $1000. We have fee-free checking for our personal accounts and I wasn't willing to pay the fees for the limited amount of freelancing I was doing. Good point. Hubby's business account requires a minimum balance of $1500 or a $12 monthly fee will be assessed (as we found out once when we'd gone lower for one of our longer trips. :glare: ) We've made sure that hasn't happened again! If one isn't earning much... honestly, keeping very accurate records is fine - something you'd be perfectly ok pulling out in an audit. You wouldn't want all of your earnings eaten up in fees! 1 Quote Link to comment Share on other sites More sharing options...
Jen500 Posted August 15, 2017 Share Posted August 15, 2017 I have never had a separate account. I just keep track of business income and expenses. I would be using my personal account for business anyways, because, for example, I'll place an order for office supplies, but some of it will only be for my home office, and some only for our household use. I just keep track of the amount spent for business. 1 Quote Link to comment Share on other sites More sharing options...
EmilyGF Posted August 15, 2017 Author Share Posted August 15, 2017 Thanks for the advice. I don't think I have time to get an account for this job (I was supposed to get info to them last week argh) but I at least got a higher level of encryption for email. If I continue past a month from now I'll definitely get one - it sounds like it isn't that much of a headache for the safety buffer it provides. Emily Quote Link to comment Share on other sites More sharing options...
Bootsie Posted August 15, 2017 Share Posted August 15, 2017 I find that income from freelancing is usually pretty easy to keep a record of without a separate account. You have the record of a check or deposit from the company and it is usually the only relationship you have with that company. It is easy to sort through bank deposits at the end of the year to look for those. What becomes more tedious is business expenditures. Often there are more, small transactions for expenditures. Often they are things that could look like other expenditures (If I go to Staples and buy paper for business use how do I keep track that it wasn't paper for homeschool use?) Quote Link to comment Share on other sites More sharing options...
whitestavern Posted August 15, 2017 Share Posted August 15, 2017 I freelance and while you don't need separate accounts, I've always just felt more comfortable with a separate one. I don't like giving my main checking account information to anyone. It's connected to my regular checking, so I can just go online and transfer the money to that account once it comes in. And it's free so no additional expense or anything. Quote Link to comment Share on other sites More sharing options...
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