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Jld473
Returning Member

Private Contractor

I have a side gig as a private contractor. Currently just have those funds going into a separate account since taxes aren't being withheld. What is the best approach that would allow me to use my funds and set aside the appropriate amount that I have to pay taxes on. 

1 Reply
KochuK
Employee Tax Expert

Private Contractor

Hi Jld473, thanks for the question.

 

If you have a regular W-2 job with this side gig, please fill out the re-designed

Form W-4 Employee’s Withholding Certificate

https://www.irs.gov/pub/irs-pdf/fw4.pdf

 

Generally, you will owe both income and self-employment taxes on any self-employment income you receive separate from the wages you receive as an employee. If you want to pay these taxes through withholding from your wages, use the estimator at www.irs.gov/W4App to figure the amount to have withheld on Step 4 (c) Extra withholding.

 

Please note that the self-employment income is net of Gross revenue less business expenses. Aside from income tax, the self-employment tax is approx. 14.13% of your net income.

 

If you do not wish to pay via regular job W4 withholding, you can always pay estimated tax payments on your own by 

https://www.irs.gov/payments

 

Hope this helps.

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