• What are the USA self employed tax brackets?

    Best answer: There are no self-employment brackets. The tax brackets are the same for everyone. It's based on taxable income. When you are self-employed, YOU must calculate, on your Schedule C (whichever version applies) plus supporting forms and schedules, what your net business income is - not the gross, but what you... show more
    Best answer: There are no self-employment brackets. The tax brackets are the same for everyone. It's based on taxable income. When you are self-employed, YOU must calculate, on your Schedule C (whichever version applies) plus supporting forms and schedules, what your net business income is - not the gross, but what you earned after all allowable business deductions were taken.

    After that, it's the same for everybody. The person who has $40,000 in taxable income from a job after all allowable deductions will owe the same INCOME tax as a self-employed person with the same exact taxable income.

    The only difference between the wage-earner and the self-employed person is that the self-employed person will pay somewhat more tax in total. That is because, in the US, when you are a wage-earner, the taxes you owe for the Social Security retirement benefit and Medicare coverage at age 65 are deducted, by law, from your pay by your employer. The employer must match that amount, and pay the total to the federal government. It's called the 'payroll tax'.

    When you are self-employed, you are both employer and employee. As the employee, you pay the same payroll tax as any employee, a percentage of your earnings. As employer, you must pay the employer's share. So you end up paying both halves of it.

    So, the bottom line is, how much of that £120,000 is net income? Let's say, for the sake of example, that you clear, after business costs, £80,000. That's roughly equal to $107,000 USD.

    In the US, someone with that income who is single will have it reduced by the $12,000 standard deduction (if they have allowable itemized deductions, it can be reduced further). So they would have taxable income of $95,000.

    The first just under $10 k is taxed at 10%. Anything up to $77,000 is taxed at 12%. The remaining is taxed at 22%. Their overall (or blended) rate might be about 15% Add to that the 7.65% payroll tax that came out of their $107,000 gross wages. Total tax rate about 22.5% not counting any state or local taxes. Many states have no state income tax. For the self-employed, their income tax would be the same at about 15%. The self-employment tax of about 15% would make their total tax rate about 30% before state and local taxes.
    12 answers · United States · 2 days ago
  • I don't understand how to do my 1040 and estimated tax payments. Can I get help understanding?

    I may be starting a job here soon as a 1099 contractor. I have never done this before, and have no clue how to do taxes for such a thing. I have lots of questions. Do I have to actually fill out a copy of my a 1040 or can I just pay my EIT quarterly? Since I am starting my contracting THIS YEAR, do I even have to... show more
    I may be starting a job here soon as a 1099 contractor. I have never done this before, and have no clue how to do taxes for such a thing. I have lots of questions. Do I have to actually fill out a copy of my a 1040 or can I just pay my EIT quarterly? Since I am starting my contracting THIS YEAR, do I even have to do EIT at all (all the 1040 forms I find online say 2017)? I get that i need to file my 1099 at the end of the year, and then my 740 (i live in KY). Are there any other forms, procedures, etc that i should know about? Sorry for the long question.
    8 answers · United States · 11 hours ago
  • How many should I claim on my tax form at work?? State and federal?

    Me and my Fiance just had a baby a month ago, and it s time to update my paper work at my work place. My Fiance does not have a job, she s a stay at home mom, and I ve claimed her on my taxes last year when I did my refund. At my job I only claim my self for federal and state. Should I be claiming two? I am taking... show more
    Me and my Fiance just had a baby a month ago, and it s time to update my paper work at my work place. My Fiance does not have a job, she s a stay at home mom, and I ve claimed her on my taxes last year when I did my refund. At my job I only claim my self for federal and state. Should I be claiming two? I am taking care of the baby and her all year so should I claim 3? or just 2? Should federal and state be the same for the amount I m claiming?
    7 answers · United States · 22 hours ago
  • If an American citizen who never lived in the USA as an adult marries a New Zealander and is a stay at home mother does she have to file?

    about her NZ husband's earnings to the IRS?
    about her NZ husband's earnings to the IRS?
    9 answers · United States · 2 days ago
  • How can I change/update my W-4?

    Best answer: Contact your employer's HR department, or if it doesn't have one, talk to your boss.
    Best answer: Contact your employer's HR department, or if it doesn't have one, talk to your boss.
    5 answers · United States · 18 hours ago
  • Can I use my health savings account to reimburse myself for lost wages incurred when staying with my child who is in the hospital?

    My child is in the hospital fairly frequently for complications with his body (I.e. airway, gi tract, and feeding tube). Often requiring extended stays in the hospital in the nicu. My company allows me FMLA to take care of him, but the way we accrue paid time off is bi- weekly instead of a lump sum. This is causing... show more
    My child is in the hospital fairly frequently for complications with his body (I.e. airway, gi tract, and feeding tube). Often requiring extended stays in the hospital in the nicu. My company allows me FMLA to take care of him, but the way we accrue paid time off is bi- weekly instead of a lump sum. This is causing severe financial hardship on the family as we only have my income and his disability payments coming in. So trying to find a way to use my HSA to help balance the load.
    9 answers · United States · 3 days ago
  • When a restaurant gets renovated by Gordon Ramsay, they get a new kitchen, new lights, etc. How do you account for those on a tax return?

    Best answer: The equipment is not free, the owner has to pay for it and the production company installs it.
    This is the way it is on improvement programmes in the UK.
    They just make it look like a gift.
    Best answer: The equipment is not free, the owner has to pay for it and the production company installs it.
    This is the way it is on improvement programmes in the UK.
    They just make it look like a gift.
    7 answers · United States · 2 days ago
  • Does the IRS ask for proof if one cites hardships for no health insurance?

    Best answer: They have definitions of what constitutes hardship or unaffordable.
    Best answer: They have definitions of what constitutes hardship or unaffordable.
    13 answers · United States · 5 days ago
  • When will I get paid ?

    I started a new job and the pay period is from June 10-June 23 and I worked June 16 and will be working 20, 21 and the 22. I get paid bi-weekly so when would I recieve my first paycheck ?
    I started a new job and the pay period is from June 10-June 23 and I worked June 16 and will be working 20, 21 and the 22. I get paid bi-weekly so when would I recieve my first paycheck ?
    10 answers · Canada · 5 days ago
  • Health care Premium tax credit with no tax return and IRS?

    So my mother got premium tax credit with healthcare.gov but she doesn't work and no income so we didn't file her tax return , But now healthcare.gov asking for her tax return for 2016 what should I do , and how much IRS can ask for repay when she has no income ! Can she file the late tax return for like... show more
    So my mother got premium tax credit with healthcare.gov but she doesn't work and no income so we didn't file her tax return , But now healthcare.gov asking for her tax return for 2016 what should I do , and how much IRS can ask for repay when she has no income ! Can she file the late tax return for like $1000 income just to have tax credit going or can i have her as my dependent under my tax return for 2016 ?
    4 answers · United States · 23 hours ago
  • If someone resides in a country outside the USA but is a US citizen by birth even though they never lived there but works online for a US?

    Best answer: US citizens are subject to US tax laws on ALL of their worldwide income. However, there are tax credits which are aimed at avoiding this double taxation. Generally the net result is that the person pays the higher of the two tax rates. For example if their tax owed to New Zealand is higher than the tax owed to... show more
    Best answer: US citizens are subject to US tax laws on ALL of their worldwide income.

    However, there are tax credits which are aimed at avoiding this double taxation. Generally the net result is that the person pays the higher of the two tax rates.

    For example if their tax owed to New Zealand is higher than the tax owed to the USA, then the USA foreign tax credits would completely eliminate their USA tax burden, leaving them with no tax owed to the USA, so effectively they just pay the higher NZ tax rate.

    However if their NZ tax burden is lower than their USA tax burden the tax credits would only cover part of their USA tax bill, leaving them to pay the difference to the USA. For example if they owed $8,000 to NZ and $10,000 to the USA, the tax credit for NZ taxes paid would reduce their USA tax burden to $2,000. Their total tax paid would be $8k to NZ and $2k to USA for a total of $10k.

    In either case, the net result is that they pay the higher tax rate, but rarely would be "double" taxed.

    Foreign taxes are far more complex than can be explained on this forum, this is only a brief overview of the basic concept, so this person would be highly advised to get professional assistance from a tax pro who specializes in filing returns for citizens living abroad.
    7 answers · United States · 4 days ago
  • Council Tax when still living with parents.?

    I live with my mum, who is physically disabled, and I don't know, I guess I just presumed that taxes come out of my wages, and never thought about, but I've never had to pay council tax, but I know my mum pays it, I just give my mum a lump sum every month for bills. It was only when someone mentioned to me... show more
    I live with my mum, who is physically disabled, and I don't know, I guess I just presumed that taxes come out of my wages, and never thought about, but I've never had to pay council tax, but I know my mum pays it, I just give my mum a lump sum every month for bills. It was only when someone mentioned to me about applying for it when they move out of their dads, did it ever cross my mind, and the internet is a bit unclear on this. Do I need to contact someone, is this something I'll be in trouble for? Or does the fact that my mum pay it count? I can't trust my mum to tell me honestly, as she is always looking for ways to save, and if she wasn't paying me, I wouldn't know. Wish they taught taxes and things in schools, I feel clueless! Thanks,
    5 answers · United Kingdom · 2 days ago