The Small Business Tax Help Blog

Archive for the ‘Self Employment Taxes’ Category

Question: Self-Employment Tax; what does it include?

From my understanding Schedule SE takes out social security and medicare. What about Federal Withholding? Do I just owe Federal Withholding at the end of the year or is there a form to cover that also?

Answer: Use form 1040ES to estimate your annual tax bill and whether or not you have to make quarterly estimated payments.

Give and take of taxes

For many who expected that their take home pay would rise this year following the tax package signed into law last month, the excitement was short-lived — or will be when they account for the state’s income tax hike.The federal tax packaged included a one-year reduction of employees’ Social Security tax rate from 6.2 percent to 4.2 percent. That savings will be largely wiped out by state …

Self Employed Tax Deductions

Question: Is self employment tax in the USA supposed to be 15% paid quarterly to the Feds?

When you are self employed in the USA aren’t you supposed to set aside 15% each paycheck and send it in to the feds each quarter (3 months)?

Answer: The IRS has set up for a person to make 4 estimated payments per year. The dates don’t work out exactly quarterly. They are April, June, Sept. & Jan. Self-employed tax is 15.3% of 92.35% of your net business income. You should also pay income tax quarterly, not just self-employment tax. Here’s a link to the estimated tax page on the IRS web site. http://www.irs.gov/pub/irs-pdf/f1040es.pdf It has a worksheet to help a person figure out how much he/she will probably owe. If you don’t pay estimated and end up owing a whole lot in April then they can charge you penalties.

New Laws Effective January 1, 2010

The following legislation will take effect beginning Jan. 1, 2010.

The Metropolitan Commuter Transportation Mobility Tax (MCTMT) – Information for Employers

Question: Estimated quarterly tax payments…?

One of my friends lives in MA and is only due to make about $6600/$6700 this year. Does he owe any state and federal tax? As well as S.S., Medicare and Self employment tax? If so, when does he have to pay the SE and FICA tax and how des he go about doing that? He’s paying federal tax payments through tax vouchers. Any help for him, thanx…

Answer: 6,600-6,700 should not generate a lot of taxes.

If he’s already paying federal via estimated tax vouchers (1040ES), then he should be okay, based on the income amount. By the way, self-employment tax (FICA is part of SE tax) is combined with income tax to make the Estimated Tax Payments.

You can have your friend read over publication 505 on estimated taxes:

http://www.irs.gov/publications/p505/index.html

MA should have similar publication on estimated taxes. Do a quick google search.

Calendar

Submissions for “Community Calendar” are required two weeks preceding the date of publication. Send to: Mary Ann Bottari, Pioneer Press, 3701 W. Lake Ave., Glenview IL 60026; mbottari@pioneerlocal.com. Information may be faxed to (847) 486-7495.

The Economy and the American Family

Question: can i estimate tax withheld from unemployment?

i live in michigan and i am currently awaiting my 1099G to come in the mail, however because i have moved there might be a problem with forwarding the document correctly to my new address (i did change my address at the unemployment office). I’d like to file my taxes soon and get it over with, do i have to wait for it to come in the mail or is there a percentage i can estimate that got taken out?

Also i took care of my mother as a home chore worker because she is disabled. I recieved a statement that said i woudl be recieving a W2 in the mail i am confused how to file this woudl i need to file a 1099 as self employment or because it comes from the government do i combine it on the 1040. Thank you in advance.

Answer: you have to select with hold taxes..

if it works the same as cali, its a check box on every form you fill out.

I owed taxes and was on unemployment all year

Special Report: Is America the sick man of the globe?

By Nick Carey

The Small Business Jobs Act of 2010

Is America the sick man of the globe?

Manufacturing and American middle-class pays the penalty after a ‘Roman orgy’ of debt. But the government can still take lessons from the German experience

Governor Daniels’ 2010 State of the State