The Small Business Tax Help Blog

Posts Tagged ‘volunteer’

Senate Session 2011-06-09 (14:29:58-15:30:25)

Question: Tax Question for an LLC?

I have a company that sells software online to fx traders in 2008?

Revenues: $ 74,952.00
Expenses: $ 13,123.66
Net Income: $ 61,828.34

What would the total tax be for a “single member LLC” in Illinois
Which includes federal, state, and self-employment taxes?
And any other taxes that I might be forgetting.

Thanks

Answer: You’ll need to file a separate return using your EIN. The LLC return should produce a K-1 form. You would pay your income tax showing the net proceeds from the K-1.
The rough estimate on the Fed portion of the LLC will be between 25-30% of your net income.

U.S. Economy: Manufacturing, Jobless Claims Point to Slowdown

Reports on U.S. manufacturing, employment and home sales pointed to slower growth in the second half of the year, just as government spending to stimulate the economy begins to wane.

Ch. 4 LLC & Self Employment Tax

Question: How much tax do I owe from 8k self-employment income and 25k regular income?

I received 25k from an employer and 8k as an independent contractor. Which forms do I fill out? 1099 and 1040? How do I figure how much I will owe? I am confused as to what is my taxable income on which form. Do I have 25k taxable income on the 1040 and 8k taxable income on the 1099? Or 33k income on both? Can I take a personal exemption on one or both forms? Thanks!

Answer: The 1099 is sort of like a W-2 - you don't file it yourself; you get it from the person/people who paid you. (There are a lot of different 1099's; for self-employment income, it'd be a 1099-Misc.) For federal taxes, you'd file a 1040, a Schedule C (the self-employment income), and a Schedule SE (figuring self-employment tax).

As to how much tax you'll owe, that depends on a lot of different information: whether or not you're married, spouse's income if any, children if any, standard vs. itemized deduction, etc. You do get to deduct half of the self-employment tax you owe, and any business expenses you can claim on the Schedule C are deducted from the self-employment income before that's added into the other income. (Word of advice: make sure you have good records for any expenses you claim; the IRS is starting to get picky. On the flip side, there's lots of things that you can claim as expenses that many people don't think of - check out IRS Publication 334.)

If you feel comfortable doing your taxes yourself, great - if you prefer electronic, I'd recommend H&R Block online or TaxCut software. If the thought of Schedules C and SE makes you nervous, talk to a tax professional. (Again, I'd recommend H&R Block - I work there, and I know all the classes we take in the off-season; we really get to know tax law!)

Best wishes and good luck!

Community Calendar

Submissions for Community Calendar are required 14 days preceding the date of publication. Send to: Niles Managing Editor, Pioneer Press, 3701 W. Lake Ave., Glenview IL 60026. Information may be faxed to (847) 486-7495 or e-mailed to mbottari@pioneerlocal.com.

Self Employment -- from the Kiplinger Family Records Organizer