As far as I know, there are 2 aspects to considered:

1. Are you mainly/exclusively working for one company (only) ?

2. The general aspects

To 1.: If you have mainly/only one company to translate for (e.g. the company your husband works for), after some years-on-end you may claim social benefits from them (a company super-annuation)
However, companies now-a-days know about this (sort of trap) and might ask/urge the translator to obtain a Gewerbeschein . . .

To 2.: I understand that it's the 'clean' way (talking taxwise) to obtain a Gewerbeschein and declare your income on a yearly basis, along with your husband's income.
It will induce some work (book-keeping) but it will save nerves and, esp., having to pay taxes at a later age when you are not translating anymore . . .

But wait and see what the othe freelancers in Germany recommend . . .

No, don't do it.
You will get all kinds of red tape and have to join a "Berufsgenossenschaft" and have to prove that you have a DIN-standard emergency kit in your home office and have all your machinery approved by local authorities (the fire department will check the electrical wiring to and from your computer and charge you for it), etc., etc., etc.

Depending on the Bundesland you live in, there is a certain amount of money you can earn each year without officially registering a business. This amounts AT LEAST to the amount considered as the poverty level. In some places it is as much as 12,000 euros a year and more.
If you have no idea how much work you will be getting, wait a year or two and then decide. During that time you can declare the money you make as "extra" income, and depending on how much your main wage-earner in the family makes, you should set aside up to 45% of what you earn to pay in back-taxes. It may turn out to be less for you, but then you have just accumulated savings, which doesn't hurt.
You can declare your "home office" as a tax deduction without officially registering a business, the only stipulation is that you have no other workplace outside the home.

Can I still deduct things like a computer?
I don't expect to earn more than $10,000 per year and am working for 4 different companies.

PS
As long as you stay under a certain limit you are not "mehrwertsteuerpflichtig". You can write, at the end of your invoice:
Ich bin nicht mehrwertsteuerpflichtig.
You must find out, however, where that limit lies. Because if you do not demand the VAT from your customer and pass it on to the IRS and you then exceed that limit, the IRS can claim that VAT from you retroactively.
But even if you earn more than, say 15,000 euros a year and have to ask for and pass on the VAT (which is only an advantage for you if you want to deduct the VAT you yourself pay on equipment and material), it is not necessary to register a business to do so.
You can charge and pay VAT without registering a business.

Sorry, our postings crossed.
Yes, you can deduct the costs for your computer, printer, paper, postage, telephone bill, etc., as long as you keep EVERY SINGLE receipt and paste it in a notebook.
You should distinguish overhead costs (computer, desk purchase, books) from costs related to specific projects (postage, disks, CDs) and identify them as such.
When you do your yearly income tax return, send copies of all your receipts (Achtung: do this in a very orderly fashion, and it will really make a difference in how much you get returned).

After your first year, the IRS (Finanzamt) will start asking for quarterly advances on taxes. So it is wise to set that money aside for starters. If you earn 10,000 euros by translating at home, the IRS will probably want at least 500 euros per quarter in advance in the following year (it depends on how high your total income is, though).

One more thing: If you are American, officially you must also report that income home to the American IRS. America is the only country in the world that charges income taxes based on citizenship and not on place of residence.
Recently the English NY Times section of the Sueddeutsche Zeitung ran an article on that. A significant number of Americans who live abroad are giving up their US citizenship for just that reason.

One last little thing: A "home office" may not have a bed in it! If you want to deduct costs for the room, it may not be used for any other purpose than for working there.

Und ich dachte immer "Übersetzer" ist ein "freier Beruf" und braucht daher keinen "Gewerbeschein"...

http://bundesrecht.juris.de/estg/__18.html
http://www.ifb-gruendung.de/pdf_etc/Freier_Be...

Thanks for that information Mark, that makes it official, whereas I was relating my experience.

The difference, though, is whether you call yourself a free-lancer (Freiberufler) or whether you give your little enterprise a name. As soon as you print yourself stationary that reads "ABC Translation" - you are considered as having founded a company of sorts (independent of the various forms).

This brings up another point: Always write your invoices in your name - don't try to create the impression that you have a little business going.

(The problem with the Berufsgenossenschaft and Industrie- & Handelskammer is that they cost you fees, fees, and more fees for nothing.)

@Lyrebird
Do you mean that a US citizen working in Germany has to pay taxes in both countries? That doesn't make sense. I have never heard of that and have been earning money in Germany for 10 years. I have permanent residence and don't ever intend on returning to the US except to visit.
What can they do to me?

As far as I know there is a tax treaty between the US and Germany which regulates where you pay taxes and makes sure you don't pay double taxes.

Nach meinen Informationen sind selbständige Übersetzer Freiberufler, egal, was sie auf ihren Briefkopf schreiben (s. der von Mark zitierte §18 des EStG).

I am currently health insured by my husband. Could I possibly send all my invoices under his name, so that it is actually his income? I know a lot of spouses do this.

Soweit ich weiß, habt ihr Kinder? Dann wäre es vielleicht lohnender, wenn du selbst deine Steuern zahlst und ihr dann das sogenannte "Ehegattensplitting" vornehmt, das lohnt sich angeblich besonders, wenn ein Ehepartner deutlich mehr verdient als der andere, wie es bei euch wohl der Fall sein würde.
Ausländerfrage: Gibt es in D nicht irgendeine Stelle, bei der man sich in diesen Dingen beraten kann? (In A würde ich da zur Wirtschaftskammer gehen...)

Ge|wer|be, das; 1. [selbstständige] dem Erwerb dienende berufliche Tätigkeit ([nicht in Bezug auf freie Berufe ...)
© 2000 Dudenverlag

"Beim Gewerbeamt müssen nicht angemeldet werden:
Freie Berufe ... sofern sie nicht durch die gewählte Rechtsform (GmbH) als Gewerbetreibende anmeldepflichtig sind" http://www.foerderland.de/126.0.html

You would only have to register at the Gewerbeamt if you had a Gewerbe, and translating is not a Gewerbe, it's a Freiberuf. That is not exactly the same as a freelancer, although it involves being a freelancer; it's a category you have only in Germany; there is an official list of Freiberufler, and translators are on it. If you did something other than a Freiberuf, such as selling goods, or started your own GmbH, you would have a Gewerbe. (If you worked for one company only, you would be an Angestellter, obviously, so also would not have to register, as you would not be "selbstständig" and thus not have a Gewerbe.) As a Freiberufler, you can employ other workers and everything, as long as you still work in your Freiberuf. http://de.wikipedia.org/wiki/Freiberuf

If you only earn 10,000 a year you don't have to charge Mehrwertsteuer (=Umsatzsteuer, same thing, different name), as lyrebird said, but you need to fill in a form for the Finanzamt to tell them what you think your income will be. This is the "Fragebogen zur steuerlichen Erfassung" http://www.ihk-wiesbaden.de/fileadmin/user_up... : tick the box that says "Aufnahme einer gewerblichen, selbständigen (freiberuflichen) ... Tätigkeit". You can write any number in the box for "expected income" as long as it is below 50,000 for the next year. You don't have to charge Umsatzsteuer if you got less than 17,500 last year and don't expect to get more than 50,000 the next year. In that case you are only a Kleinunternehmer and thus don't have to charge Umsatzsteuer according to § 19 UStG. (You can write "Kein Mehrwertsteuer laut § 19 UStG" on the bill if you like.)

Unless your husband employs you, I shouldn't think you can send bills in his name.

I suspect that at 10,000 you will exceed the limit for getting insurance cover in your husband's name. It's normally only 400¤ per month or something. You'll have to look into a "Freiwillige Versicherung" if you have statutory health insurance, or think of going private, which is cheaper. (But if you do go private, it is hard to go back to statutory health insurance, and the payments rise as you get older.) The Freiwillige Versicherung is quite expensive, so if you are not willing to go private, because you plan to stay longer in Germany, for example, it is worth thinking about trying to earn more than 10,000 a year, or you will be losing so much from your monthly income that you may as well just be earning less than 400¤ in the first place and not having all the bother with tax, insurance etc.

My 2 cents: it is definitely worth discussing this with a tax advisor. Also, get this BDÜ book on translating: http://www.rp.bdue.de/ErfolgreichSelbstaendig.pdf which has all this kind of practical information on the laws related to translating, how to write a bill, etc.

I just re-read my own comment and realised it wasn't very clear:

If you worked for one company only, you would be an Angestellter, obviously, so also would not have to register, as you would not be "selbstständig" and thus not have a Gewerbe

Maybe this isn't so obvious: make sure you are not only working freelance for one company - if you want to work for only one company as an Angestellter that has to be written in your contract. Otherwise you might count as "scheinselbständig".

Thank you CM2DD! That was very helpful.
It sounds like I either need to earn a lot or stick to the 400 Euro limit. I'm over 40 so private health insurance is not an option.
When I had my restaurant, I paid almost 300 in health insurance even though I was operating at a loss, which made me decide to close down.

The German system is not designed to encourage people to work part-time, is it? If you're earning between 400 and 1000 a month you feel a complete idiot as you may as well be earning less than 400 and watching talk shows all day. I was quite worried about that when I signed up for freiwillige Versicherung at 300 a month, not knowing how long it would take me to start earning more than 1000. It's worth it trying it out, though; I get a good bit more than 400 euro even after tax and insurance :-) and making the leap from 400 to more than 1000 a month took much less time than I thought. Joining the BDÜ helped.

If you're on a really tight budget or really, really can't afford to lose any money, you could go to the Arbeitsamt and see what kind of start-up schemes they have now. When I started up they did have a lot of schemes which involved getting money from the Arbeitsamt and (I think) some sort of tax reduction (?) but now it's changed. I didn't use a start-up scheme anyway, as it involved an absolutely ridiculous amount of paperwork to the extent that you would not actually have enough time to start working. (Interviews where you had to sell your business idea; making your own charts describing the situation on the market you wanted to enter ... they didn't want to give up that money easily!)

@ Just Wondering, Y9TYN, and Kate,

sorry, but the treatise between the US and Germany does NOT say that you only pay income taxes in ONE COUNTRY, it says that the two countries EXCHANGE INFORMATION on the income of its residents!!!

From personal experience I know that you tend to think since net taxes are generally higher here there is NO WAY you could have to pay US income taxes. Unfortunately that is not true. Taxes are split up into several categories and the church taxes you pay in Germany and the "Sozialabgaben" do NOT COUNT as income tax in the USA. In addition, the last State of your residence may have claim to some State taxes that do not exist in Germany. As long as you maintain US citizenship that holds - even if you have lived here for 40 years.

The only good thing the treatise regulates is that what you have paid into Social Security in the US gets counted as "years paid" in Germany (but NOT AMOUNT). In other words, the years you paid into Social Security get added to the number of years you paid into the German Rentenversicherung, so that you can reach the total number of years necessary for getting "Rente" (someday - if that system does not breakdown in the meantime). But the amount of money you paid into Soc Sec has no effect on the amount of Rente you will get in Germany. (This arrangement was made because otherwise people who worked half their life in one country and half in the other would never get enough years accumulated to get Rente at all.)

The US Consulate has two brochures: One is for Germans who plan to work for a while in the US, the other is for Americans who work in Europe. I strongly recommend getting yourself one because YES, they can come get you for those taxes years after you earned your money.
(I don't know the specific range, but I think it is 15 years.)

If you still have any income in the US at all (are renting out your house while you live here? do you have any stock or saving in the bank for which you're getting interest?) it is worth getting a tax specialist to do the paperwork for you. Ask your parents/friends/relatives if they know someone reliable and get your things straightend out. Better safe than sorry.

Am I understanding you correctly? Are you saying I may owe taxes to the US? Will I have to change my citizenship?

@ Just Wondering,

yes, that is correct.
And it is better for you to look into it and find out what you may owe than that THEY look into it and in the end you have to pay a fine on top of your back-taxes.

The only way to avoid it is to go live in a trailer in the woods in Portugal. You are registered with the consulate here, and they keep tabs on you, whether you like it or not.

@CM2DD Thanks a lot for your helpful advice.
I've just ordered the booklet from the BDÜ. I think it will help me a lot. I occasionally make translations into Spanish, but I'm thinking seriously about making a real "Nebenjob" out of it.

This discussion is really interesting. The comments are very helpful. Thanks a lot.

These two books have been mentioned in previous threads, but for all who missed it, here they are again:

Geoffry Samuelsson-Brown: A Practical Guide for Translators (3rd revised edition)

Douglas Robinson: Becoming a Translator. An Accelerated Course.

Both are very helpful, particularly if you do not have a certified degree in translating.

Good Luck.

@lyrebird: Thanks a lot for the information.
Well, my English is not what it used to be before I came to Germany in the early nineties, so I'm afraid I'm forced to get the information in Spanish or German.
That's why I'm here in the forum. I'd like to refresh my English, and this seems to be an ideal way.

Just looked this up:
From:http://germany.usembassy.gov/germany/faqs/tax...

8. I am a U.S. citizen living overseas with no U.S. income but substantial foreign income. Must I file a U.S. tax return?
Yes. U.S. citizens must report their worldwide income on their U.S. tax returns. If you paid income taxes to a foreign country, you may qualify for
a foreign tax credit. IRS Publication 514 “Foreign Tax Credit for Individuals” explains how to calculate this credit. You may also qualify for a foreign earned income exclusion of up to $82,400 for 2006. Qualification requirements and forms to be completed are explained in IRS Publication 54 “Tax Guide for U.S. Citizens and Resident Aliens Abroad”.

11. I am a U.S. citizen who has lived abroad for several years and didn't know I had to file a U.S. tax return? What do I do now?
As a U.S. citizen or resident alien (valid green card holder), you are required to file a return for any year that your income exceeded the minimum income levels. If you had a filing requirement, your earned income is foreign sourced, and you choose the exclusion, you should begin by filing the current year’s tax return and the preceding two years. You can choose the exclusion on a return provided you owe no federal income tax after taking into account the exclusion. If you owe federal income tax after taking into account the exclusion, you can choose the exclusion on a return filed after the periods described above provided you file before IRS discovers that you failed to choose the exclusion. You must type or legibly print at the top of the first page of the Form 1040

"Filed pursuant to Section 1.911-7(a)(2)(i)(D)."

If you owe federal income tax after taking into account the foreign earned income exclusion and the IRS discovered that you failed to choose the exclusion, you must request a private letter ruling under Revenue Procedure 92-85 (as modified by Revenue Procedure 93-28).

If a tax liability is incurred for one of those years, then you should generally file returns for an additional two prior years (for a total of 5 tax years). Please go to www.irs.gov for prior year forms.

See!
Thanks for providing the details.

Now the tricky part is, if you file a joint tax claim in Germany because your husband earns so much more than you, do you have to pay US taxes on your part of HIS income?

"You may also qualify for a foreign earned income exclusion of up to $82,400 for 2006"

If the exclusion is that high, I shouldn't have anything to worry about, even if I do have to declare half of my husband's income.

According to IRS Publication 514 "You can choose each tax year to take the amount of any qualified foreign taxes paid or accrued during the year as a foreign tax credit..."

So if you can take a tax credit for foreign taxes paid, and those foreign taxes are higher than the US taxes, you shouldn't owe anything. So it sounds like this filing requirement is just a way for the US government to create paperwork and keep tabs on its citizens. Am I right?

No, I think that since it starts with "substantial income" these rules are directed at people who earn quite a bit. But we all hope to get there, don't we?

One thing I would like to know: Is a translation a service or a product? (Dienstleistung oder Produkt?) Doesn't that make a difference in whether or not you have to charge "Mehrwertsteuer"?
If we are grouped with the dentists etc., as "Freiberufler" - well, they don't charge it, do they?

It is §19 UStG!!! And write on your invoice: Keine Mehrwertsteuer laut Kleinunternehmerregelung §19 UStG.

And you don't need a Gewerbeschein. Just the Tax ID (Steuer-Nummer).

Interestingly, all this talk of paying taxes in the US doesn't actually address the question of the legality of the whole affair. The US IRS has no legal basis for collecting taxes, period! There's no law in the US mandating that anybody, whether in the US or not, has to pay income tax. In fact, it's unconstitutional.

There's loads of info on this on t'internet. Look it up!

MsG

aurock: The question "service" or "product" does not make a difference for VAT. It does, however, make an interest in liabilities, warranties and the like. German law distinhuished between a Kaufvertrag and a Werkvertrag. in the former, you sell a good and have to give Gewaehrleistung that it is ok, i.e., may have to give the money back within two years if it is defective. In a Wervertrag, things are quite different. There may be, e.g., the possibility to quote a price as based on "best effort" etc. I have forgotten the details, however, and they also changed substantially a couple of years ago. One thing is clear IMO: A translation is a service, not a product.

Gürkchen,

Not so fast. You also need a German VAT No. (Umsatz- / Mehrwertsteuer-Nr.) if you're going freelance as a translator, but the German tax authorities simply issue with that - you don't have to apply for it separately. It will arrive in the mail.

@CM2DD: Ich komme etwas spät zu diesem Faden, wollte aber meine Dankbarkeit darüber zum Ausdruck bringen, dass Du Klarheit in diese Angelegenheit gebracht hast. Da wurde doch sehr viel Unwahres oder nicht mehr Zutreffendes geschrieben.
 
@Kate:
zu Nummer 2: Die Gesetzeslage zur steuerlichen Absetzbarkeit des häuslichen Arbeitszimmers hat sich geändert. Man kann es nur noch absetzen, wenn man nachweislich den Schwerpunkt seiner Tätigkeit dort hat (nicht mal mehr die Lehrer können ihr Arbeitszimmer absetzen). Bei Dir dürfte das dann aber der Fall sein. Man kann aber meines Wissens auch ein halbes Zimmer anteilig absetzen (es stimmt also nicht ganz, dass kein Bett im Zimmer stehen darf - man darf dann eben nur nicht das ganze Zimmer als Arbeitszimmer abrechnen).
 
Zur sog. "Kleinunternehmerregelung" hat CM2DD alles gesagt.
Mir persönlich hat die von CM2DD genannte Lektüre zu Beginn meiner Selbständigkeit sehr geholfen. Auch von meiner Mitgliedschaft im BDÜ habe ich (nicht zuletzt durch die vielen Kontakte zu Kollegen!) sehr profitiert.
 
Noch eine Anmerkung: Übersetzer ist ein "Freier Beruf" und gehört zu den sogenannten Katalogberufen, wie auch schon andere hier gesagt haben. Man muss auf keinen Fall ein Gewerbe anmelden und hat auch mit keiner Kammer zu tun. Das ist wichtig, denn Du willst ja auch keine Gewerbesteuer zahlen.
In diesem Zusammenhang sei noch darauf hingewiesen, dass Post Nr. 8 größtenteils unrichtig ist. Auch wenn man als freiberuflicher Übersetzer keiner Kammer angehört, kann man sehr wohl als Unternehmer mit einem anständigen Briefkopf auftreten. Ich darf mich auch "Flink-und-sauber-Übersetzungen Vorname Nachname" nennen, also unter einer selbst gewählten Bezeichnung firmieren. Allerdings muss diese bei Einzelunternehmern immer auch den Namen des Unternehmers (Inhabers) enthalten. Hierzu und zum Start in die Selbständigkeit bieten die Industrie- und Handelskammern auch uns Freiberuflern kostenlose (!) Vorträge und Informationskurse an. Die Webseiten der IHKn sind ebenfalls empfehlenswert, dort finden sich u.a. Informationen zur Firmierung, also wie man seine Firma nennen darf.
 
Ich selbst habe zu Beginn meiner Selbständigkeit für sechs Monate einen Existenzgründerzuschuss vom Arbeitsamt erhalten und fand nicht, dass das mit großem Aufwand verbunden war. Ich musste einen Business-Plan schreiben, habe diesen vom BDÜ begutachten lassen, und schon war die Geschichte erledigt.
 
Zum Thema Krankenkasse: Je nach Verdienst (wo die Grenzen aktuell liegen, weiß ich nicht) brauchst Du eine eigene Krankenversicherung. Ein Tipp: Das Scheidungsrecht hat sich geändert. Auch wenn ich Dir eine lange und glückliche Ehe wünsche (so wie auch ich hoffe, dass mich das Schicksal Scheidung nicht trifft), so gibt die Statistik zu denken. Die sogenannte "Hausfrauenehe" wurde mehr oder weniger abgeschafft. Es lohnt sich also, jeden Cent, den Du verdienst auch anzugeben, damit Dir später bei der Rente nichts fehlt. Außerdem würde - wie andere auch schon sagten - lieber etwas mehr arbeiten und verdienen, eine eigene KV abschließen und wäre dafür unabhängig.
 
Wichtig ist: Suche Dir gute Berater (vielleicht nicht unbedingt in einem öffentlichen Forum, auch wenn Leo natürlich eines der besten, seriösesten und vertrauenswürdigsten Foren überhaupt ist), die wissen wovon sie reden.
Also: 1. Einen Steuerberater suchen, 2. jemanden fragen, der sich mit dem Thema Selbständigkeit auskennt, 3. Dich mit anderen Übersetzern zusammenschließen; 4. Bücher lesen (der "Freiberufler-Atlas" ist ganz brauchbar: # ISBN-10: 3548366619; # ISBN-13: 978-3548366616).