Stay Informed!

The Self-Employment Tax Strategy: Empowering Entrepreneurs at Tax Time

Wednesday, December 14 from 4 - 5 PM EST

The Self-Employment Tax Initiative (SETI) is a small business development strategy that takes advantage of the tax code to help low-income, self-employed individuals formalize and grow their businesses, create jobs and access tax-based asset building opportunities.

Thanks to those who joined us for Empowering Entrepreneurs at Tax Time, a webinar sponsored by the Northwest Area Foundation, to learn about two creative ways to adapt the self-employment tax strategy for your own tax assistance program, microenterprise development agency or other community-based organization. We shared more background on the strategy behind the Self-Employment Tax Initiative, review the program’s history and go over some major lessons learned. Practitioners from AccountAbility Minnesota and Brooklyn Cooperative Federal Credit Union, who have designed, implemented and run their own very different self-employment tax programs outlined the techniques they’ve used and shared real world procedures, challenges, successes and lessons from their experiences.

Panelists included:

• Kim Pate, Vice President of External Relations at CFED
• Rebecca Pear, Business Tax Counselor at Brooklyn Cooperative Federal Credit Union
• Tom Larson, Self-Employment Coordinator at AccountAbility Minnesota

The presenters also stayed on to answer questions from the audience. Rebecca shared more details about her experience serving taxpayers with ITINs and others with special concerns; Tom spoke about the screening process for self-employed taxpayers prior to their appointments and what that entails in an ideal world. Self-employed taxpayers are always screened via phone before setting up an appointment for assistance - Tom talks with the client first to determine whether they're within scope and then discusses the intricacies of self-employment tax filing, like the differences between mileage and deducting gas expenses. He determines their profile - how much money they have coming in, whether they have additional W-2 income and so on - and then asks them to fill out the tax organizer. Ideally, clients will come in well-organized with as much information as possible.

For the AccountAbility Minnesota Tax Organizer in English click here; for the same organizer in Spanish, click here. To see other organizer tools, visit the SETI Resource Bank's Tools for Helping Clients Get Organized.

Many audience members were also interested in learning more about tools and software programs Tom and Rebecca would recommend for helping self-employed individuals and small businesses organize their finances. Tom created an income and expense worksheet for self-employed clients in excel that has formulas already programmed. Rebecca suggested trying out www.indinero.com, which offers a platform similar to www.mint.com's online program that pulls information from your bank account and helps to organize it based on different types of expenses. While Mint is geared toward individuals, inDinero is aimed at small business owners. 

Watch the Recorded Webinar

• Click here to watch the video recording of the webinar. In order to view the video, you will need to download and install the GoToWebinar codec available here.
• Click here to see the PowerPoint slides from the webinar.

If you have any other questions, please contact us at seti@cfed.org.

More Resources

• For more sample tools created by local SETI partners, please visit the Templates, Tools and Resources section of our SETI Resource Bank. 
  
• For more information about the Schedule C VITA Pilot, take a look at our Schedule C VITA Pilot Final Report from Tax Year 2010. 
  
• For more information about Brooklyn Cooperative Federal Credit Union, take a look at the Practitioner Bulletin on the Brooklyn Cooperative Fee-for-Service Model.
• Representative Judy Chu's recent introduction of theEntrepreneur Startup Growth Act also came up during the Q & A Session. For more information, visit Rep. Chu's website - SETI will share more information as it becomes available.