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New Member
posted Apr 1, 2024 3:13:16 PM

I need help estimating Fed Taxes for 2024. Filing as an Independent contractor for the first time

What percent of my pay should I reserve for FED TAXES.

0 3 670
3 Replies
Level 15
Apr 1, 2024 3:22:33 PM

You will owe 15.3% of your earned income plus income tax at your marginal rate. As a rule of thumb withholding about 30% usually works out. 

Level 2
Apr 1, 2024 3:27:25 PM
Expert Alumni
Apr 1, 2024 3:30:34 PM

If you can estimate your income, subtract the standard deduction for the filing status you use. 

So if you think you'll make 50,000 and your filing Married Filing Jointly, your Standard Deduction will be 14,600.

That will leave 35,400 taxable income.

Lets say you're in the 12% tax bracket that would be 4,248 Income tax you would owe. 

On top of that, since you are self-employed, you pay your own FICA tax (Social Security) which is 15.3% although you also get a deduction for half that amount. 

 

As stated above, 30% should cover your tax payments, but there are other factors such as tax credits (like the Child Tax Credit) and other income sources, like wages and Capital Gains. 

 

HERE is a link with more information 

@jccorey67-gmail-