As the workforce continues to evolve since the COVID-19 pandemic, remote work has become the norm for many. With this, the demand for freelancers, independent contractors, and solopreneurs has increased.
Businesses are turning to this flexible work model because workers can contribute to projects without being physically present. This shift has highlighted the need for efficient, inexpensive, and easy tax software tailored to this increasing workforce.
G2’s new Freelance Tax category contains software solutions to tackle these challenges. These tools help the self-employed save for, calculate, and pay income taxes.
What is freelance tax software?
Freelance tax software helps simplify the often confusing process of tracking income and expenses, identifying tax deductions, allocating funds for future tax payments, estimating quarterly taxes, and facilitating payments to tax authorities.
These solutions often integrate with users' bank accounts, providing an overview of their financial records.
Features of freelance tax solutions that help improve efficiency:
- Expense Tracking
- Income Allocation for Tax
- Quarterly Tax Estimation
- Bank Integrations
- Payment Assistance
However, the current features are not the only thing freelancers can look forward to. Driven by constant advancements in technology, this software's future has many possibilities.
Here are a few potential upgrades and additions we can expect in this space:
- Automation: Automation can help streamline repetitive tasks, such as expense tracking and categorization.
- Machine learning: More sophisticated algorithms could help freelance tax software offer more personalized recommendations and insights based on spending patterns, industry trends, and changes in tax regulations.
- Blockchain security: This technology might be used to increase the security and transparency of freelance financial transactions by making financial data and tax-related information tamper proof.
- Cryptocurrency transactions: As the use of crypto for purchasing products and services increases, we might see freelance tax software be able to track cryptocurrency transactions and assist in managing the taxation of those transactions.
G2 users review freelance tax software products
Even though the Freelance Tax category is new, users have already reviewed and commented about the benefits of using this type of software.
A reviewer for Keeper wrote:
“It makes tax filing a lot easier, and allows you to find tax savings and file taxes."
A reviewer for Bonsai wrote:
“I recently added the tax and accounting software, and I'm really excited that I no longer have to manually track income and expenses in a spreadsheet. It lays everything out in the dashboard, and I can easily see how much money I've made each month or quarter!”
Freelance tax software vs. freelancer management systems
While both serve to ease the lives of freelancers and those who use their services, it's important to distinguish between freelance tax software and freelancer management systems.
Freelance tax software is essentially a tool for individuals, as it guides users through the complex world of freelance finance.
Freelancer management systems aid businesses in managing freelancers comprehensively—from onboarding to contracts, payments, and project management.
The future of freelance tax software
The COVID-19 pandemic has given freelancers and independent contractors an even more prominent role in the workforce.
Therefore, the demand for efficient and user-friendly tax software is increasing, and G2’s new Freelance Tax category is a great place to search for the perfect solution.
With basic but important features, such as expense management, tracking income, and tax calculation, along with future AI and ML integrations, this type of software will play a crucial role in allowing freelancers and solopreneurs to thrive.
Learn more about how freelance software is attracting new investments based on the continued shift to remote work.
Edited by Jigmee Bhutia
Track expenses for potential deductions
