How much should I save from each paycheck for taxes if im a 1099 contractor and will be a dependent on my parents tax return?

noblebakken — Sat, 01 Jun 2019 19:24:15 GMT

I am starting a new job as a 1099 contractor. From the research that I have done, it looks like you are advised to set aside 25-30% from each paycheck for taxes. I am wondering if this will be any different because my parents will file me as a dependent on their tax return. This is in preparation for next years tax return.

My old job was a standard W-2 employee so my taxes were withheld.

How old are you? Are you also a full time student?

SweetieJean — Sat, 01 Jun 2019 19:24:17 GMT

How old are you? Are you also a full time student?

I am 19 years old, will be 20 in 2019. I will be full tim...

noblebakken — Sat, 01 Jun 2019 19:24:18 GMT

I am 19 years old, will be 20 in 2019. I will be full time this fall semester and sprint 2019 semester.

If you will make 12K in profits then 15% is fine ... othe...

Critter — Sat, 01 Jun 2019 19:24:19 GMT

If you will make 12K in profits then 15% is fine ... otherwise save 25%.

If you are new to being self employed and acting as your own bookkeeper and tax preparer you need to get educated ....

If you have net self employment income of $400 or more you have to file a schedule C in your personal 1040 return for self employment business income. You may get a 1099-Misc for some of your income but you need to report all your income. So you need to keep your own good records. Here is some reading material……

IRS information on Self Employment….
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center

Publication 334, Tax Guide for Small Business
http://www.irs.gov/pub/irs-pdf/p334.pdf

Publication 535 Business Expenses
http://www.irs.gov/pub/irs-pdf/p535.pdf

Home Office Expenses … Business Use of the Home

https://www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction

https://www.irs.gov/pub/irs-pdf/p587.pdf

There is also QuickBooks Self Employment bundle you can check out which includes one Turbo Tax Home & Business return and will help you keep up in your bookkeeping all year along with calculating the estimated payments needed ....
http://quickbooks.intuit.com/self-employed

Self Employment tax (Scheduled SE) is generated if a person has $400 or more of net profit from self-employment on Schedule C. You pay 15.3% for 2017 SE tax on 92.35% of your Net Profit greater than $400. The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare. So you get social security credit for it when you retire. You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040. The SE tax is already included in your tax due or reduced your refund. It is on the 1040 line 57. The SE tax is in addition to your regular income tax on the net profit.

PAYING ESTIMATES
For SE self employment tax - if you have a net profit (after expenses) of $400 or more you will pay 15.3% for 2017 SE Tax on 92.35% of your net profit in addition to your regular income tax on it. So if you have other income like W2 income your extra business income might put you into a higher tax bracket.

You must make quarterly estimated tax payments for the current tax year (or next year) if both of the following apply:
- 1. You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits.

- 2. You expect your withholding and credits to be less than the smaller of:
90% of the tax to be shown on your current year’s tax return, or
100% of the tax shown on your prior year’s tax return. (Your prior year tax return must cover all 12 months.)

To prepare estimates for next year, You can just type W4 in the search box at the top of your return , click on Find. Then Click on Jump To and it will take you to the estimated tax payments section. Say no to changing your W-4 and the next screen will start the estimated taxes section.

OR Go to….
Federal Taxes or Personal (H&B version)
Other Tax Situations
Other Tax Forms
Form W-4 and Estimated Taxes - Click the Start or Update button

I will add a couple of things:. That is perfect for Fede...

TaxGuyBill — Sat, 01 Jun 2019 19:24:21 GMT

I will add a couple of things:. That is perfect for Federal, based on your PROFIT. In other words, if you have expenses, save that percentage based on your 'net' income after expenses. Also, you may want to save for State as well (anywhere from 0% to 10%, depending on the State and the amount).

topic How much should I save from each paycheck for taxes if im a 1099 contractor and will be a dependent on my parents tax return? in Get your taxes done using TurboTax

How much should I save from each paycheck for taxes if im a 1099 contractor and will be a dependent on my parents tax return?

How old are you? Are you also a full time student?

I am 19 years old, will be 20 in 2019. I will be full tim...

If you will make 12K in profits then 15% is fine ... othe...

I will add a couple of things:. That is perfect for Fede...