topic I just started up my single member LLC in Michigan. How do I go about doing estimated self employment taxes if I have no idea what my income will be? in Get your taxes done using TurboTax

I just started up my single member LLC in Michigan. How do I go about doing estimated self employment taxes if I have no idea what my income will be?

lmholmes11 — Sat, 01 Jun 2019 00:46:50 GMT

You can get more information about how much estimated tax...

TonyL — Sat, 01 Jun 2019 00:46:51 GMT

You can get more information about how much estimated taxes you will have to pay in this IRS publication: <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p505.pdf">https://www.irs.gov/pub/irs-pdf/p505.pdf</a>

Based on this and your other question, please educate you...

SweetieJean — Sat, 01 Jun 2019 00:46:54 GMT

Based on this and your other question, please educate yourself regarding self-employment taxes:
<a rel="nofollow" target="_blank" href="https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center">https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center</a>
<a rel="nofollow" target="_blank" href="https://www.irs.gov/businesses/small-businesses-self-employed/publications-and-forms-for-the-self-employed">https://www.irs.gov/businesses/small-businesses-self-employed/publications-and-forms-for-the-self-employed</a>

"Self Employment Taxes" is a piece of tax jargon and rela...

TomYoung — Sat, 01 Jun 2019 00:46:55 GMT

"Self Employment Taxes" is a piece of tax jargon and relates to Social Security and Medicare taxes on your income. You will pay both the "employer" and "employee" portion of these taxes.

As an independent contractor/sole proprietor you will be responsible for paying both income taxes on your income plus Self Employment Taxes. Both of these taxes go on your Form 1040 and comprise your income tax liability before credits for taxes withheld or other credits you man be entitled to.

People who have significant income not subject to withholding are required to make "estimated tax payments" more or less quarterly, typically on 4/15, 6/15, 9/15 and 1/15 of the following year. These estimated tax payments will cover both income taxes and SE Taxes.

Since the income cutoff date for the 9/15 estimated tax payment is 8/31 and as you've "just started" your LLC right near the end of July, it's unlikely that you'd need to make any estimated tax payment on 9/15, unless you make a ton of money in your first month of operation. Absent that happy event you can probably wait to make your first estimated tax payment in January, 2017. In late December, 2016 TurboTax 2016 will be available in both online and desktop versions - in a preliminary form at least - and at that point you should be able to make some reasonable estimates of what your 2016 income tax return will look like to determine if you need to make a January, 2017 estimated tax payment. You could even use your 2015 program to do this (with a new tax file, of course) earlier in the year to get a sense of whether you might need to make that January, 2017 payment.

I would recommend at least skimming through Pub 505 referenced in TurboTaxTonyL's comment above to get a sense of how estimated taxes work. Understand that it's not necessary that the total of "estimated taxes", (and any withholding), actually amount to the tax liability you finally calculate when you complete your 2016 income tax return. All you really need to do is pay sufficient taxes to avoid being "underpaid" and incurring "underpayment" penalties. The Pub lists out the "safe harbors" that you can get into that allow you to avoid underpayment penalties, even if you owe the IRS a ton of money.

Tom Young

Check out this bookkeeping option ...
Critter — Sat, 01 Jun 2019 00:46:57 GMT
Check out this bookkeeping option ...<a rel="nofollow" target="_blank" href="https://quickbooks.intuit.com/oa/t/qbks-6371/b/selfemployed?gclid=Cj0KEQjw_eu8BRDC-YLHusmTmMEBEiQArW6c-K4fl6onwwGIsKwpj9vzCr2-AqZ5vSGZi2wEHm5gUXgaAmgv8P8HAQ&cid=ppc_G_Broad_US_QBSE_US_BMM_NB_Self-Employed_Tier-2_G_S_-+self-+employment_txt&utm_source=oaqbse_ppc&utm_medium=ppc&utm_term=%252Bself%2520%252Bemployment&utm_campaign=%7bcampaign%7d&utm_content=ppc_G_Broad_US_QBSE_US_BMM_NB_Self-Employed_Tier-2_G_S_-+self-+employment_txt&ef_id=VYk9IgAAAbTrIA2h:20160729171937:s">https://quickbooks.intuit.com/oa/t/qbks-6371/b/selfemployed?gclid=Cj0KEQjw_eu8BRDC-YLHusmTmMEBEiQArW6c-K4fl6onwwGIsKwpj9vzCr2-AqZ5vSGZi2wEHm5gUXgaAmgv8P8HAQ&cid=ppc_G_Broad_US_QBSE_US_BMM_NB_Self-Employed_Tier-2_G_S_-+self-+employment_txt&utm_source=oaqbse_ppc&utm_medium=ppc&utm_term=%252Bself%2520%252Bemployment&utm_campaign=%7bcampaign%7d&utm_content=ppc_G_Broad_US_QBSE_US_BMM_NB_Self-Employed_Tier-2_G_S_-+self-+employment_txt&ef_id=VYk9IgAAAbTrIA2h:20160729171937:s</a>