Being self-employed doesn’t have to mean dreading tax season. With a few smart money habits, you can stay organized, lower your stress, and avoid scrambling in April. Whether you’re an interior designer, online coach, or run a home service business, these habits can make taxes less overwhelming.

1. Use a Separate Business Bank Account

One of the easiest ways to simplify your finances is to separate business and personal funds. If you're depositing client payments and paying for materials, software, or marketing from the same account where you buy groceries or pay your rent, it’s going to be messy.

Having a dedicated business bank account allows you to:

Track income and expenses clearly
Maintain clean records in case of an audit
Avoid paying taxes on personal deposits
Make bookkeeping a thousand times easier

Most banks offer low-fee or even free business checking accounts. Open one as soon as possible if you haven’t already. It’s a small step that pays off big.

2. Track Expenses Weekly (Not Just at Year-End)

Don’t wait until March or April to dig through piles of receipts. Make it a weekly habit to categorize and log your expenses. Use tools like QuickBooks, Wave, or a simple spreadsheet. If you're a paper person, scan your receipts and store them in a labeled folder by month.

This habit helps you:

Capture every deduction you’re entitled to
Reduce errors
Stay prepared for quarterly tax estimates
Save time during tax season

Tip: Set a recurring reminder in your calendar for Friday afternoons or Monday mornings. Make it part of your weekly business routine.

3. Save for Taxes Automatically

Self-employed folks don’t have taxes withheld from their pay like W-2 employees do. That means you need to set aside money yourself. A good rule of thumb is to save 25–30% of your net income (after expenses) for taxes.

Create a dedicated tax savings account and automatically transfer a percentage of each client payment into it. That way, the money is there when it’s time to pay quarterly estimated taxes or your annual return.

Pro tip: Label the account something like "Tax Hold" so you’re not tempted to dip into it.

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4. Pay Yourself Consistently

Paying yourself like an employee, even if you’re a sole proprietor—builds healthy financial habits and prevents you from over-spending business income. Transfer a fixed amount from your business account to your personal account on a regular schedule (weekly, bi-weekly, or monthly).

This helps with:

Budgeting your personal finances
Keeping your business cash flow predictable
Understanding how much your business really makes

Once your business grows, this becomes essential for tax planning. And if you convert to an S Corp, it’s legally required to pay yourself a reasonable salary.

5. Schedule Quarterly Check-ins

Don’t wait until year-end to figure out if your business is profitable—or if you owe taxes. Set aside time every three months to:

Review income and expenses
Evaluate what’s deductible
Check if you’re on track to meet your savings goals
Prep for your next estimated tax payment

Use this check-in to adjust your savings rate, plan for major purchases, or prepare for slower seasons.

Final Thoughts

Tax season doesn’t have to be stressful. Build these five habits into your routine and you’ll feel more in control of your business finances—and way more prepared when April comes around.

Need help getting your records in order or figuring out what to set aside? At Hodge & Co., we make tax season simple for self-employed professionals. Reach out if you want support.