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andreTaxMan
Level 1

How to file/Should I file?

Hi there,

 

I just accepted a job offer paying $90,000/year and I think I am in a different tax bracket now (compared to before when I was making $54,000). Since they are taking a larger percentage of money from me via taxes, does that mean my return in April will be larger than ever before? Also, I've historically chosen the option to withhold more taxes NOW for a larger return LATER. but I'm wondering if that's actually the best move, or if I should be choosing to receive more money NOW?

Secondly, I am about to become certified as a personal trainer/nutritionist and will help coach people on the side for payment. If I earn a hypothetical (extra) $20-30k a year from that. Would I have to report that, even if it was Venmo'd to me or paid in cash? And if so, how would i report that for taxes? I don't want to get hit with a lofty sum that I owe.

 

Thank you very much,

Andre

1 Reply
conniem123
Employee Tax Expert

How to file/Should I file?

Hi Andre,  Congratulations on the new job and the new certification!  Yes, with more taxable income comes more taxes.  While that should mean more tax is withheld from your paycheck, sometimes it is not to the same proportion.  Its a good idea to submit an updated Form W-4.  There is a W-4 Calculator that will take you step-by-step through the worksheet,

 

https://turbotax.intuit.com/tax-tools/calculators/w4/

 

Once you complete the form, give it to your employer. Then, keep a close eye on your next few paychecks to see how the changes impacted your federal income tax withholding.

 

Your income you receive from personal trainer you will report as self employed income.  Your self employed business income and business expenses are reported on Schedule C, Profit or Loss from Business, and are included then on your individual tax return.  Many newly self-employed people are surprised at their tax bills at the end of the year because they notice they're suddenly paying a lot more in tax as a self-employed person than as an employee. That's because they're carrying the full burden of paying for their Social Security and Medicare.  Here is a great resource for self-employed taxes,

 

https://turbotax.intuit.com/tax-tips/self-employment-taxes/the-self-employment-tax/L8xXjolB4

 

and self-employed business expenses

 

https://ttlc.intuit.com/turbotax-support/en-us/help-article/self-employment-taxes/self-employed-expe...

 

Hope this is helpful!

 

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