Taxes For Dummies, 2026 Edition

How do I file taxes as a freelancer or independent contractor?

You'll report income on Schedule C and pay self-employment tax (15.3%) on net earnings via Schedule SE. Deduct business expenses like home office, equipment, software, and mileage. Make quarterly estimated payments to avoid penalties. Tax software like TurboFax Self-Employed or FreeTaxUSA handles all these forms — budget $50-120 for the filing.

What happens if I owe taxes but can't pay?

File your return on time regardless — the failure-to-file penalty (5% per month) is 10x worse than the failure-to-pay penalty (0.5% per month). Then apply for an IRS installment agreement, which lets you pay over 72 months. For debts under $50K, you can set this up online at irs.gov without calling.

What is the penalty for filing taxes late?

If you owe money, the failure-to-file penalty is 5% of unpaid taxes per month, up to 25%. If you're getting a refund, there's no penalty for filing late — but you have 3 years to claim it before the IRS keeps your refund. Always file an extension (Form 4868) if you can't make the April deadline; it gives you until October 15.

What happens to my taxes when I get married?

Getting married changes your filing status to Married Filing Jointly or Separately, which often lowers your combined tax bill. The MFJ rate brackets are wider than single filer brackets, reducing the rate on income that would have been taxed higher. You may also gain access to credits like the Earned Income Credit that have higher income thresholds for joint filers.