self-employment forms

[Roserobbins]

Hello,

I also am new to this. I became an Independent Contractor March 2023 but just learned about self-employment taxes. I don't know all the tax forms that I need to complete.

I also just started an LLC, no employees besides me and I would like to know the forms I need to complete for that also.

The question is, can you let me know any and all tax forms I need to fill out for being an Independent Contractor and all the forms necessary to get me started as an LLC?

Thank you!

[marctu]

Hello @Roserobbins, and thank you for the question.  So, this answer will be limited to the tax part of your question, though I am sure that you must file with your state for the LLC filing on a yearly basis.  You also want to check with your city, municipality, county, etc. to see if you may

So, most LLCs, that are single member LLCs, such as your LLC file as a disregarded entity.  That simply means that you will be filing both the income and expenses on a Schedule C when you file your taxes for 2023 in 2024. 

You also want to plan now to see if you may need to make estimated tax payments.  Remember individuals often have to pay estimated federal and state taxes on profits from the business.  This is an excellent Turbo Tax resource: Self Employment Tax for Beginners 

In the abstract let’s do a quick example of self-employment income.  For every $1,000 of net income, you would need to pay Self-Employment taxes of 15.3%, plus federal taxes, which range from 10% to 37%, and state taxes potentially as well.  Taking the lowest percentages, the tax would be 26.3%.   The tax bills could be significant, so you want to get out ahead of this and estimate what your net income is and make estimated payments.  There is nothing worse than an unexpected bill. 

 This is how you would make the payments to the IRS after you have calculated the payment:

• You can submit them online through the Electronic Federal Tax Payment System.
• You can also pay using paper forms supplied by the IRS.
• When you file your annual tax return, you'll pay the balance of taxes that weren't covered by your quarterly payments.

You may also want to apply for an Employee Identification Number for your LLC. Go here: Apply for an EIN.  This allows you to use your Employee Identification Number when filling out a W-9, which entities paying you will require. 

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[Art EA]

You will file a schedule C to claim your self employment income and a Schedule SE to pay your self employment tax.  The schedule SE is a combo of you Fica and Medicare tax.