Sean Pyles

But then they also had to pay additional self-employment taxes when they filed, so they probably underpaid their taxes there.

That's what that sounds like to me.

That also makes me think that it's really important to be on top of how you're tracking your income and your expenses for your business.

That leads us to talking about having an accounting or bookkeeping system in place to follow all of this so you don't miss something.

How do you track your expenses for your business, Elizabeth?

Yeah, I'm in the same boat for my firm.

I mean, I just got my firm started midway through 2025.

And then I had that whole like getting married and going on a three week honeymoon thing.

So I didn't have a lot of income and expenses for my business.

Maybe going into this year, depending on how things go, I might adopt something like Quicken, which I know a lot of people love.

Love the plug.

But make sure you're doing it correctly because a lot of folks might think, oh, I can just deduct my entire apartment or my house because I work here.

No, the IRS has some pretty specific definitions of how the space is used or not used.

So do not run afoul of that.

People should also consider contributing to a retirement savings account for self-employed people.

This could be a SEP, which is a simple employee pension, or a simple IRA.

And this can help you save for retirement, but also do keep track of those contributions too.

They can help you reduce your taxable income.

And one really big thing to emphasize, too, is to avoid co-mingling funds from the business side of your operation and your personal finances.

So I would recommend opening a separate account for business expenses, if possible, that can help you track them more easily and have a paper trail and just avoid having your own personal income potentially be in the hands of the IRS for your business activities.