Estimating Taxes

Forum|Forum|3 years ago
November 17, 2022
1 reply
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This fall, I became 100% 1099. I've been using Quickbooks - Self Employed to help me stay organized and estimate my taxes. Am I correct in assuming that for this fall (to pay in Jan 2023), I should pay taxes according to my 2021 joint filing rate? And then in Q1 of 2023, I start to pay the amount recommended by QB?

VolvoGirl

Level 15

No, not exactly. You still pay the Joint regular income tax on all your income which includes your Net Profit but you will also pay 15.3% Self Employment Tax on your Net Profit over $400. I don't know how Quickbooks works. Does it give you a tax amount on your total income plus the SE tax?

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.