Virtual Assistant Taxes in Connecticut - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for a Virtual Assistant in Connecticut

Connecticut’s thriving business landscape offers numerous opportunities for skilled Virtual Assistants, but navigating the tax implications of self-employment is crucial for success.

As a Virtual Assistant operating in Connecticut, income earned through freelance work is considered self-employment income. The IRS requires all self-employed individuals with net earnings exceeding $400 to report this income on Schedule C (Profit or Loss from Business) and pay self-employment taxes. Accurate record-keeping throughout the year is essential for a smooth tax filing process.

How Connecticut Handles Gig Worker Taxes

Connecticut, like most states, requires residents to file a state income tax return. As a self-employed individual residing in Connecticut, you are obligated to report your income and pay state income taxes on your earnings. Connecticut utilizes a graduated income tax system, meaning the tax rate increases as your income rises. For the 2025 tax year, Connecticut residents will file using Form CT-1040, and self-employed individuals will likely need to utilize Schedule CT-1040-SB (Self-Employment and Business Income). It’s important to note that Connecticut does not offer a separate self-employment tax like the federal government; however, your federal self-employment tax calculation impacts your Connecticut adjusted gross income (AGI), which is used to determine your state tax liability. Connecticut also allows for certain business expenses to be deducted when calculating your state taxable income, mirroring many of the federal deductions. Furthermore, Connecticut offers a credit for taxes paid to other states, which may be relevant if you provide services to clients outside of Connecticut. Staying current with Connecticut’s tax laws is vital, and resources are available through the Connecticut Department of Revenue Services: Connecticut Department of Revenue Services. Failure to file and pay state taxes can result in penalties and interest.

Key Tax Deductions for Home-Based Virtual Assistants

• Home Office Deduction: The home office deduction allows Virtual Assistants to deduct expenses related to the portion of their home exclusively and regularly used for business. “Exclusive use” means that space is only used for work, and “regular use” means it’s used consistently for business activities. Taxpayers can choose between the simplified method, which offers a standard deduction of $5 per square foot of the home used for business (capped at 300 square feet), or the actual expense method, which requires calculating the percentage of the home used for business and deducting a proportionate share of mortgage interest, rent, utilities, and other related expenses.
• Hardware & Software: The cost of essential hardware, such as computers, webcams, and printers, is generally deductible. Software expenses, including subscriptions to programs like Adobe Creative Cloud, project management tools, or website hosting, are also deductible as ordinary and necessary business expenses.
• Internet & Phone Bill: If a portion of your internet and phone service is used for business, you can deduct the business-use percentage. For example, if 60% of your internet usage is for client work, you can deduct 60% of your internet bill.

Note on Mileage: As a predominantly home-based worker, mileage deductions are less common for Virtual Assistants. However, any mileage incurred for occasional client meetings, attending industry events, or running business-related errands can be claimed using the standard mileage rate or actual expenses.

The 15.3% Self-Employment Tax Explained

The 15.3% self-employment tax comprises two components: Social Security and Medicare contributions. Employees have these taxes withheld from their paychecks, with employers matching the contributions. As a self-employed individual, you are responsible for paying both the employer and employee portions of these taxes. This tax applies to your net earnings – your business income minus allowable business deductions – exceeding $400.