Thank you in advance for your help! Im soo confused and anxious about doing estimated taxes. Please explain in as simply as you are able to.
I have a small business and my husband works another job of which he recieved a W 2 and has taxes taken out each paycheck. We will file jointly next year and will report business income on a schedule C.
1. My understanding is that I can proceed with calculating estimated taxes based on only my small business Gross income or Net after deductions? Is this correct please?
2. Do I figure out Social Security and Medicare taxes at 15.3% and then incorporate this amount into my estimated taxes owed?
3. How does the Social Security and Medicare taxes eventually get to where they need to be and when are they credited to my earnings? Does this happen when we file our joint return?
4. Do I have to apply any business related deductions reducing estimated taxes owed or can we just enter them on a schedule C when we file our joint return? (I can't be sure what all of our expenses will entail for the year).
5. My business income may vary widely. Can I adjust each quarters payments? There isn't really a way I will know how much I will make for the year.
6. What is the Safe Harbor rule? Last year my business Gross income was approximately $15,000.00, but due to so many start up and other expenses, we showed a loss of approximately-$ 400.00.
Thank you kindly!!
