Hello! I started my private practice in April 2023 as a sole proprietorship and will be receiving 1099 but also work as a per diem, where I receive a W-2. My tax person shared he would be doing a schedule C since I am a sole proprietor and also will be receiving a W-2. Am I able to pay taxes for this year when I get my taxes next year?
Great Question. Remember that being paid via a 1099 is a very different than being paid as an employee. Don't forget to set aside money from each paycheck if possible for your self employment tax (Rate 15.3 %) I recommend to set aside 20% since you are in California and most likely will also have state taxes to pay:(
Filing a schedule C will allow you to deduct expenses that are necessary and ordinary to your line of work. Having the right mind set is the key as most self employed people "normally" pay. I dont know all the specifics to your case, but I assumed no kiddos :(
Thank you! That is correct, no children, nor am I married. I was setting aside 30% monthly for taxes. So, should I set aside 20% instead a month or should I stick to the 30% I was doing?
Check what your effective tax rate since you perhaps may be in a higher tax bracket. Remember that SE tax is just the Medicare and social security. It does not include income tax. The 20-30% is just a range. If you happen to be on the higher range, you got yourself a "refund" from your own money 😉
Which is the best website to calculate my overall taxes?