The Self-Employed Guide to Stress-Free Tax Time

It’s time to file your taxes. Gulp. Cue the horror movie soundtrack.

When you’re self-employed, it’s normal for tax time to feel daunting and dreadful. But here’s the good news: It doesn’t have to be quite so painful. With a little bit of preparation and know-how, you can take at least a little bit of the stress out of your end-of-year tax filing as a freelancer or solopreneur.

This guide walks you through what you need to know about filing your taxes as a sole proprietor so you can approach the process with more confidence (and less cringing).

When to File Your Taxes: Key Deadlines Solopreneurs Should Know

As a freelancer, you know that deadlines matter—and that applies to your taxes too. Missing tax due dates can lead to late fees, interest charges, and plenty of panic that would have otherwise been avoided.

There are two different types of tax due dates you’ll want to mark down for your business-of-one: the annual tax filing deadline and your quarterly estimated tax deadlines. Let’s take a closer look at each of these.

Annual Tax Filing Deadline for Sole Proprietors

The deadline to file your federal income tax return is April 15. If this date falls on a weekend or holiday, the deadline shifts to the next business day. Looking at 2025, that means the filing due date is Tuesday, April 15.

This is the big return that you file once each year. You’ll report your total income and deductions to find out if you owe more taxes or are receiving a refund. Don’t panic yet—we’ll dig into the nitty-gritty of this a little later.

Quarterly Estimated Tax Deadlines for Sole Proprietors

When you’re a sole proprietor, you don’t have taxes withheld from your paycheck like a traditional employee. So, roughly every three months, you need to make payments to cover your income tax and other tax obligations (like self-employment tax).

You’ll submit two payments every quarter: one payment to cover your federal tax obligations and one to cover your state tax obligations. The deadlines for these estimated payments are:

• April 15
• June 15
• September 15
• January 15 (of the following year)

Again, if the due date falls on a weekend or holiday, it’s pushed to the next business day. But, sticking with the 15th deadline ensures you always pay on time (or, even better, early).

TIP: We’re covering taxes for sole proprietors in this guide. But, if you operate your business as an S Corporation, there are additional tax forms and due dates you’ll need to be aware of.

How to File Your Taxes: A Step-by-Step Guide for Solopreneurs

Ready to file your end-of-year tax return for your business-of-one? Here are four simple steps to get through the process with as little stress as possible.

1. Gather Your Paperwork

Start by gathering your necessary paperwork. When you’re self-employed, this can include things like:

• Profit and loss statement that summarizes your business’ income and expenses
• Categorized list of your business expenses
• 1099-NEC forms received from any clients that paid you more than $600 during the year
• Record of your estimated tax payments for the year
• Retirement contributions if you contributed to a SEP IRA or Solo 401(k)

When you file taxes as a sole proprietor, your business and personal income and expenses are one in the same. That means you’re filing just one return that covers your business and personal tax obligations. So, you’ll need any personal forms too—like interest you earned from investments or any mortgage interest payments you made, as just a few examples.

The key here is to start early. Your clients need to give you your 1099-NEC forms by January 31, which means you should have plenty of time to pull your documents and get organized well ahead of the April 15 tax filing deadline. Doing so ensures you don’t miss anything important and also helps you avoid unnecessary stress.

2. Fill Out Your Tax Forms

Now that you’ve rounded up all of your data and documents, you’ll input it all into a tax form for easy calculating and processing. Form 1040 is the primary tax return form for individuals. But, since you also have business income, you’ll need to attach a Schedule C that reports your business income and expenses.

If you’re working with an accountant, they’ll do all of this for you. You’ll simply give them all of the information you gathered in the first step so that they can complete the forms, send them for your review, and then submit the return on your behalf.

This step is also when you’ll find out if you owe more taxes for the year or will receive a refund. While a refund feels like “free” money, it’s actually just excess tax payments you made throughout the year that the IRS gives back to you.

3. Submit Your Return

When your forms are filled in, you (or your accountant) are ready to submit your return. There are two different ways you can get your tax return information to the IRS:

• E-filing: You’ll submit your return online, and it’s the fastest and easiest way to file your taxes. It also allows you to receive your refund faster (if you’re getting one, of course).
• Mail: You can also submit your return via mail by using the IRS address listed for your specific state.

Again, if you’ve enlisted the services of an accountant, they’ll take care of this part for you.

4. Pay Any Owed Taxes (If Applicable)

Understandably, you were hoping for a tax refund. But, if you find out that you still owe more in taxes, making those payments is your final step. These payments are due by the tax deadline on April 15—which is yet another reason to start your tax prep process early.

If you owe more than you can pay right now, you can set up an installment plan with the IRS and pay off your balance over time. You’ll still pay the full amount, but it’ll be spread out over an agreed-upon timeframe.

3 Common Tax Challenges for Solopreneurs

As long as you’re somewhat organized, tax time doesn’t need to be a complete burden when you’re self-employed. With that said, there are a few tax challenges that are unique to solopreneurs.

1. Understanding the Tax Process

Those relentless feelings of confusion and overwhelm are probably the biggest roadblock as a freelancer. The tax code is complicated—and that’s especially true when you’re self-employed.

When you feel so intimidated by the tax process, it’s tempting to avoid it and let your record keeping become a tangled mess. But that only makes things more challenging when tax time rolls around.

Solution: Find a resource that can give you trustworthy, expert answers to your tax-related questions as they come up. This can be an accountant or a technology solution like the LettuceHead AI chatbot.

2. Keeping Track of Expenses

It’s hard to overstate the importance of tracking your expenses as a solopreneur. These business-related expenses are tax deductions, which can save you a lot of money by reducing your taxable income.

Despite the benefits, many self-employed people struggle to keep track of their expenses and receipts throughout the year. That means they need to look back through a years’ worth of transactions when it’s time to file their taxes.

Solution: Set up a system—whether it’s accounting software or even a spreadsheet—you can use to reliably log your expenses throughout the year. For example, Lettuce will continuously track and categorize your expenses for you, so you’re ready to go at tax time.

3. Missing Deadlines

Tax deadlines (especially the due dates for your quarterly estimated payments) have a way of sneaking up, and it’s easy to lose track of them in the hustle of your client work.

But missing these deadlines can mean having to spend even more money in late fees and interest charges. So, you want to make sure you’re ahead of the game.

Solution: Mark the tax filing deadlines and estimated payment due dates in your calendar right away. Rather than just marking down the deadline, put a reminder in your calendar at least a week ahead of time so you get your payments ready to go. Or, opt for a solution like Lettuce that will automatically handle your tax payments for you.

How Lettuce Makes Tax Filing Stress-Free

Even if you know what’s coming, tax time can still feel overwhelming. Fortunately, you don’t need to go it alone. Lettuce can save you a lot of time and tears.

Here’s how it works: If you don’t already have one, Lettuce will set up a business entity (either an LLC or an S Corp) for your business. Lettuce will also create a business bank account for you that connects directly to the platform.

With those pieces in place, you’ll benefit from:

• Real-Time Tracking: Lettuce automatically tracks all of your income and expenses so you can keep detailed financial records and eliminate surprises when the end of the year rolls around.
• Automated End-of-Year Review: As tax season closes in, Lettuce begins an automated review and prepares your financial data for easy filing. In January, Lettuce prompts you to confirm the final details for your tax return.
• Tax Form Preparation: Lettuce will auto-generate all of your essential tax forms and save you the hassle of manual inputs and calculations.
• Draft Preparation and E-Signing: Lettuce prepares a draft of your return for your review which you can e-sign directly through the platform.
• Proactive Notifications: With reminders and updates throughout the filing process, Lettuce makes sure you don’t miss key deadlines or steps. Plus, it can even automatically pay your taxes for you.

Taxes are important—but you can’t afford to have them consume all of your time and energy. Lettuce simplifies your tax filing so you can focus on what matters most: your business.

Take the Terror Out of Tax Time

When you’re a solopreneur, tax time is enough to inspire a cold sweat or a shiver down your spine. And, while you’ll likely never look forward to tax time, it doesn’t have to be the stuff of nightmares.

When you understand the ins and outs, stay organized, and enlist the help of tools like Lettuce, you can simplify the process, turn down the horror movie soundtrack, and move forward with confidence.

Want to learn more about how Lettuce can transform tax time from scary to simple? See how it works.