Freelance Video Editors: What percentage of income typically goes to taxes after deductions?

4 From my experience helping freelancers manage their taxes, most video editors end up with a significantly lower effective tax rate after deductions than the raw percentages would suggest. The self-employment tax (15.3%) hits on your net business income, not gross. Most freelance video editors can legitimately deduct quite a bit: portion of home used for business, software subscriptions, computer equipment, external hard drives, cloud storage, professional development, maybe even travel to client shoots. You also get to deduct half of the self-employment tax itself! Equipment depreciation is huge for video editors - those high-end workstations and cameras don't come cheap. Just make sure you're following proper depreciation rules (or using Section 179 for immediate expensing when applicable). On average, I see successful video editors paying effective tax rates around 15-25% of their gross income after all deductions, depending on their business structure and spending patterns.

13 I switched from full-time to freelance video editing about 3 years ago and was terrified about taxes at first. After struggling with some confusing advice online, I found this tool called taxr.ai (https://taxr.ai) that helped me understand my actual tax situation much better. What surprised me was how many deductions I was missing! I was able to properly categorize things like my Adobe subscription, external hard drives, even a percentage of my internet bill. The tool analyzed my expenses and showed me I could legitimately deduct about 30-35% of my gross income, which brought my effective tax rate way down from what I initially feared. The best part was being able to upload receipts and have the AI tell me if they qualified as business expenses. No more guessing if something is deductible!

9 Update on my skepticism about taxr.ai - I decided to try it after all, and I have to admit it's actually pretty useful. I uploaded my last year's expenses (which were a complete mess) and it organized everything into proper tax categories in minutes. The thing that won me over was how it identified several deductions I missed last year, including some equipment depreciation I didn't calculate correctly and a conference I attended that was partially deductible. It estimated I overpaid about $3,800 in taxes last year! Already filed an amendment to get some of that back. For video editing specifically, it correctly identified that my color calibration tools, reference monitor, and even my noise-canceling headphones were legitimate business expenses. Not revolutionary information, but the organization and validation helped a lot.

7 If you're going freelance, the worst part isn't even calculating the taxes - it's dealing with the IRS when you have questions or problems. I spent HOURS trying to get through to someone when I had questions about estimated payments. Then I found this service called Claimyr (https://claimyr.com) - you can see how it works here: https://youtu.be/_kiP6q8DX5c Basically, they get you through to an actual IRS agent instead of waiting on hold forever. When I was confused about how to handle income from foreign clients (had a UK production company hire me), I used Claimyr and got connected to an IRS agent in about 20 minutes instead of the 3+ hour wait I experienced before. They just call you when an agent is on the line. Completely changed how I deal with tax questions now.

21 I have to eat my words about Claimyr. After dismissing it, I got desperate when dealing with a CP2000 notice (the IRS claimed I underreported income). Couldn't get through the normal way after trying for days. Used Claimyr out of desperation and got connected to an IRS agent in about 35 minutes. Resolved my issue in one call - turns out a client had filed a 1099 with a typo in my SSN, making it look like I hadn't reported the income when I actually had. Not having to spend my entire day listening to hold music was worth it. As a video editor, time literally is money, and spending 3+ hours on hold would have cost me a half-day's income.

11 For video editors specifically, make sure you're tracking EVERYTHING. Some deductions I take that have been accepted on audit: - Portion of streaming services (research/reference) - Music subscription services - Hard drives and cloud storage - Computer upgrades - Ergonomic office furniture (saved my back!) - Professional memberships - Reference books/tutorials After all deductions, I generally pay about 22% of my gross income in combined federal/state/SE taxes. I set aside 25% to be safe and usually get a small refund.

15 Quick reality check for anyone going freelance: remember that the first year is the hardest tax-wise cause you're figuring everything out. My first year I way overpaid (like 35% of gross) cause I was scared of owing. Second year I got smarter with tracking deductions and quarterlies and got it down to around 20% effective rate. Some expenses are obvious (software, hardware) but don't forget things like: - Internet (partial) - Cell phone (partial) - Business liability insurance - Health insurance premiums (self-employed deduction) - Office supplies - Professional development

As someone who's been freelancing in video editing for about 18 months now, I can share some real numbers. My effective tax rate ended up being around 18% of gross income after all deductions last year. Key deductions that made a big difference for me: - Home office (about 15% of my rent/utilities) - Equipment depreciation on my editing rig and monitors - Adobe Creative Suite and other software subscriptions - External storage and backup solutions - Partial car expenses for client meetings - Professional liability insurance The biggest surprise was how much the home office deduction helped - I have a dedicated editing room, so I can legitimately deduct that percentage of all housing costs including rent, utilities, even renter's insurance. I'd recommend setting aside 25% of each payment when starting out. Better to have a cushion than scramble to pay quarterly taxes. Once you get a feel for your actual effective rate after the first year, you can adjust accordingly. Also consider making estimated payments slightly higher than required - any overpayment becomes a refund, and it's better than owing penalties for underpayment.

One thing I wish I'd known before going freelance - don't forget about quarterly estimated tax payments! The IRS expects you to pay as you go, not just once a year. If you owe more than $1,000 when you file, you could face underpayment penalties even if you pay everything by the April deadline. The due dates are January 15, April 15, June 15, and September 15. I use Form 1040ES to calculate what I owe each quarter. Pro tip: if you had W-2 income the previous year, you can base your estimated payments on 100% of last year's tax liability (110% if your AGI was over $150k) and avoid penalties even if you end up owing more. For video editors specifically, income can be pretty irregular - some months feast, some months famine. I found it helpful to set aside 25-30% of every payment into a separate tax savings account, then make estimated payments from there. Takes the stress out of those quarterly deadlines when you know the money is already saved up.