Your first freelance payment is worth celebrating. It can also leave you wondering, “How much of this can I spend?” If you’re starting out in Buffalo, you don’t need to figure out your whole tax return today. Start with three things: keep a record, set some money aside, and check whether a payment is due.
Maybe you’re designing menus for a local restaurant after work, or maybe freelancing is your main source of income. Either way, the first few months can feel unpredictable. A simple routine will do more for you right now than a perfect spreadsheet you never open.
1. Write down what came in and what you spent
A spreadsheet or notebook is fine. When a client pays you, jot down who paid you, the date, and the amount. Keep the invoice or payment confirmation in the same place. For expenses, save the receipt and add a few words about what it was for. “Software for the menu project” will mean more to you in six months than a charge you barely remember.
Write down payments that come by cash, check, or an app. If a client doesn’t send you a 1099, keep the payment in your records anyway. The form shows the payments a client or platform reported. It isn’t a complete list of everything you earned.
A quick example: Say a Buffalo business pays you $1,000 to design a menu, and you spend $200 on deductible expenses for the job. That leaves $800 in profit before taxes. That $800 is the starting point for estimating taxes on this job. It’s also a reminder to budget for work expenses and taxes before deciding what you can spend.
Common expenses worth tracking
- Cellphone: If you use one phone for client calls and personal calls, save the bills and keep a note showing how you figured the share you use for business. For example, if your bill is $80 and your records support 25% business use, the business portion is $20. That’s an example, not a percentage to use for your own bill.
- Vehicle mileage: Suppose you drive from a client meeting in Buffalo to a printer in Amherst to pick up proofs for that job. If the trip is 12 miles, log those 12 miles along with the date, where you went, and why. Record trips as you make them and keep track of your total miles for the year. Leave out personal errands and your regular commute.
- Software, supplies, and fees: Save receipts for things like a design subscription you use for client work, printed proofs for a project, or fees a payment app charges to process client payments. Add a short note if the receipt doesn’t make the business purpose clear.
If you use the standard mileage rate, don’t also count gas or repairs for those miles. The mileage rate and actual car expenses are two different ways to figure the deduction. For now, a simple mileage log gives you a place to start.
Make it easy on yourself: Pick one place for invoices and receipts. Set a short reminder once a week to add anything you missed. If you’ve already done a few jobs without keeping records, start with your bank statements, payment apps, and email. Rebuild what you can and mark anything you’re unsure about.
2. Set money aside as you get paid
Move some money to a separate savings account when a client pays you, if you can. Label it “Taxes.” That small habit helps you see what’s available for rent, supplies, or your own pay. If you’re just getting started, the goal is to build the habit and then check whether you’re setting aside enough.
How much should you save? There isn’t one percentage that works for everyone. Two people can earn the same amount from freelancing and need to save different amounts. One may also have a job that already takes taxes out of each paycheck. The other may depend on freelance income alone.
Your plan may need to cover federal income tax, New York State income tax, and self-employment tax, which covers Social Security and Medicare. If you’d rather get help with the estimate, bring what you’ve earned and spent so far, what you expect to earn for the rest of the year, and a recent pay stub if you also have a job. You can start with rough numbers and update them when you know more.
What if your income changes every month? Check in after a busy month, a new regular client, or a big expense. A tax savings plan you made when you had one project may need to change once you’re doing several. If work slows down, review what’s already in savings and what you’ve paid before deciding what you can afford to move.
3. Check whether you need to pay during the year
Putting money in savings doesn’t count as paying taxes. You may need to send part of what you owe during the year. These are called estimated payments. Check the federal and New York State rules separately. If you need to pay both, send one payment to the IRS and another to New York State. Save each confirmation and note the tax year it applies to.
If freelancing is a side job, ask whether having more federal tax taken out of your regular paycheck could cover some or all of what you expect to owe the IRS. Check New York State separately so you know whether you still need a state payment.
If you started midway through the year, or most of your work comes in one season, check your next deadline before deciding what to send. The official links below are a good place to start. Put the next date on your calendar even if you haven’t figured out the amount yet. Give yourself a few days before it’s due to pull your records together or ask for help.
When your tax forms start arriving
Compare any 1099s you receive with the payments you’ve already written down. If a client’s form shows the same $1,000 that’s already in your spreadsheet, check it off there. Don’t add it a second time. If a number looks different, look at the invoices and payment records first. Ask the sender if you still can’t tell why it’s different.
If you’re meeting with a tax preparer, bring your income and expense totals, the forms you received, and any confirmations for tax payments you made. That gives you a useful starting point, even if there are a few expenses you still have questions about.
What to do this week
- Gather what you already have. Put your invoices, payment confirmations, and receipts in one folder.
- Look at what came in and went out. Get a rough idea of what you’ve earned after business expenses.
- Give your tax money a place to go. Pick where you’ll set it aside the next time a client pays.
- Check the next payment dates. If you’re unsure whether they apply to you, ask while there’s still time to plan.
If all you do today is make the folder and add your first payment, you’ve made a good start. If you’d rather talk through the numbers with someone, get help with self-employed taxes in Buffalo. If you’re ready to look at the math, try the federal tax estimator for a rough federal estimate or read the 1099 estimated-tax guide. The estimator doesn’t calculate New York tax.