Help with understanding what is taxable income

I think you are thinking about this as "sales tax" but what taxable means is simply that you are self-employed and you have to pay taxes an the money that you make. When you freelance you need to save about 25-30% of what you make for taxes. That is why contractors can charge more money, because they have to compensate for the taxes they will have to pay. For graphic design depending on your skill level and clientèle you can charge anywhere from $40-$70 maybe more. Figure out what you need to make to cover your living expenses and mark that amount up by 25-30% to cover your taxes. Also save receipts for lunches, utilities, supplies, software - everything so you can deduct these expenses and lower the amount of income you will need to pay taxes on. I hope that helps :)

It's ALWAYS a good idea when you start something new or have a big change in your life and finances to go see a CPA. It may cost $150 or so, but they will easily save you that much in deductions that you may miss.

Tax is charged based upon where the job is delivered to. If they pick it up then it is based upon your city/state. If you ship then it is there city/state.