If Im self employed

[VolvoGirl]

What is your question? 

You can enter Self Employment Income into Online Deluxe or Premier but if you have any expenses you will have to upgrade to the Self Employed version or use any of the Desktop CD/Download programs.

How to enter income from Self Employment

https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/...

[rangda00]

• My specific question is, does the standard deduction apply to the federal tax if I'm self employed, 1099 independentcontractor. Im a consultant. I rarely work. I have no expenses to declare. And I will make under 10k. (I know I have to pay Medicare and social security, im not asking about that). I don't need to know how to file. Thank you

[LenaH]

Generally, all tax filers can claim the standard deduction unless they choose to itemize their deductions. If you have nothing to itemize, then you would qualify for the standard deduction. 

Only certain taxpayers aren't entitled to the standard deduction:

1. A married individual filing as married filing separately whose spouse itemizes deductions
2. An individual who was a nonresident alien or dual-status alien during the year (see below for certain exceptions)
3. An individual who files a return for a period of less than 12 months due to a change in his or her annual accounting period
4. An estate or trust, common trust fund, or partnership

@rangda00

[VolvoGirl]

Yes you get the Standard Deduction.  

Don't confuse itemized deductions on schedule A with your business expenses/deductions on schedule C. They are separate. For Schedule A personal deductions, you get to take your itemized deductions or the standard deduction, whichever is larger.  Itemized deductions are things like Medical, Gifts to Charity, State Income Taxes Paid, Mortgage Interest, Property Taxes, Car Registration fees, etc.

You get to take both,  your business expenses AND the Standard Deduction (or your personal Itemized Deductions).  And you have to enter your business expenses.  Be aware, if you have self employment income you can get in trouble for not reporting all your expenses to qualify for the EIC, Child Tax Credit or or other credits.

[rangda00]

Thank you. Regarding my expenses, I literally just drive to a doctor's office, witness an office visit, and go home and write a report in my bedroom. A law firm pays me to do this for their client. They include my car mileage in my check. I'm paid by the hour. I do this only 2 days per month. So I don't think I have any expenses to report. I am not incorporated,  just a 1099-nec independent contractor. And I will only need the standard deduction.  In this case, what expenses would they be looking for that I would get in trouble for not reporting?

[rangda00]

Thank you. My concern is this: I am paying 90% of the self employment tax quarterly (medicare and social security). But I don't think the IRS asks for quarterly federal tax payments. Is that true? I worried that I would get hit with a big tax bill for federal taxes at the end of the year. But if I am making under 10k, I thought I might not owe much in federal taxes after the standard deduction and maybe the earned income credit.  Is that true? Am I getting that right?

[LeonardS]

Yes, your income is below the taxable threshold for income tax but you are required to pay self-employment tax which is 15.3% on any net income above $400.

[VolvoGirl]

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit (If it is 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 (FICA). So you get social security credit for it when you retire.

The SE tax is already included in your tax due or reduced your refund. It is on the 1040 Schedule 2 line 4 which goes to 1040 line 23. The SE tax is in addition to your regular income tax on the net profit.

Are you paying enough quarterly?  When you fill out your tax return you enter the quarterly estimates you paid to get credit for them.  

Turbo Tax will calculate the 1040ES estimated payments.
https://ttlc.intuit.com/community/tax-payments/help/can-turbotax-calculate-next-year-s-federal-estim...

You must make quarterly estimated tax payments for the current tax 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).

[rangda00]

Thank you so much.