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phonger2002
New Member

I’m a new 1099 contractor. I’ll receive my first 1099 paycheck in 12/2017. If I file 2017 taxes before 1/15/18, do I still have to make estimated tax payment for 12/2017?

 
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VolvoGirl
Level 15

I’m a new 1099 contractor. I’ll receive my first 1099 paycheck in 12/2017. If I file 2017 taxes before 1/15/18, do I still have to make estimated tax payment for 12/2017?

AND Some general info......  You will need to keep good records.  You may get a 1099Misc at the end of the year if someone pays you more than $600 but you need to report all your income no matter how small.  You might want to use Quicken or QuickBooks to keep tract of your income and expenses.  There is one called QBSE QuickBooks Self Employed that works with Turbo Tax and will give you a free online tax return next year.
 http://quickbooks.intuit.com/self-employed

To report your self employment income you will fill out schedule C in your personal 1040 tax return and pay SE self employment 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 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.  So you get social security credit for it when you retire.  You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040.  The SE tax is already included in your tax due or reduced your refund.  It is on the 1040 line 57.  The SE tax is in addition to your regular income tax on the net profit.

Here is some IRS reading material……

IRS information on Self Employment
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center    

Publication 334, Tax Guide for Small Business
http://www.irs.gov/pub/irs-pdf/p334.pdf  

Publication 535 Business Expenses
http://www.irs.gov/pub/irs-pdf/p535.pdf

The first year you don't need to pay estimates as long as you pay in (by withholding) as much as your tax was last year.  But if you will have a big income you should send in estimates so you don't owe too much next April on your tax return.

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3 Replies
VolvoGirl
Level 15

I’m a new 1099 contractor. I’ll receive my first 1099 paycheck in 12/2017. If I file 2017 taxes before 1/15/18, do I still have to make estimated tax payment for 12/2017?

AND Some general info......  You will need to keep good records.  You may get a 1099Misc at the end of the year if someone pays you more than $600 but you need to report all your income no matter how small.  You might want to use Quicken or QuickBooks to keep tract of your income and expenses.  There is one called QBSE QuickBooks Self Employed that works with Turbo Tax and will give you a free online tax return next year.
 http://quickbooks.intuit.com/self-employed

To report your self employment income you will fill out schedule C in your personal 1040 tax return and pay SE self employment 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 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.  So you get social security credit for it when you retire.  You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040.  The SE tax is already included in your tax due or reduced your refund.  It is on the 1040 line 57.  The SE tax is in addition to your regular income tax on the net profit.

Here is some IRS reading material……

IRS information on Self Employment
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center    

Publication 334, Tax Guide for Small Business
http://www.irs.gov/pub/irs-pdf/p334.pdf  

Publication 535 Business Expenses
http://www.irs.gov/pub/irs-pdf/p535.pdf

The first year you don't need to pay estimates as long as you pay in (by withholding) as much as your tax was last year.  But if you will have a big income you should send in estimates so you don't owe too much next April on your tax return.
fanfare
Level 15

I’m a new 1099 contractor. I’ll receive my first 1099 paycheck in 12/2017. If I file 2017 taxes before 1/15/18, do I still have to make estimated tax payment for 12/2017?

No. But it's unlikely you will have all the tax documents that are mailed in Jan or Feb by then, so Yes.

SweetieJean
Level 15

I’m a new 1099 contractor. I’ll receive my first 1099 paycheck in 12/2017. If I file 2017 taxes before 1/15/18, do I still have to make estimated tax payment for 12/2017?

or that the IRS will even have efile open by then.
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