Self-employed. Entered into Premier $35,926 from a 1099-NEC. Turbo says I owe $9270 in taxes while 2023 tax tables say $4091? Why the big difference?

[sufford]

Does Social Security somehow play a factor in this?

[fanfare]

Being Self-employed is the relevant factor.

[VolvoGirl]

Yes you need to pay Social Security.  You will pay Self Employment tax (Scheduled SE) on a Net Profit of $400 or more on Schedule C in addition to regular income tax on it.   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.  So you get social security credit for it when you retire.  

Was the $35,000 the gross income or the Net Profit after expenses?  You can enter expenses for the 1099NEC work.  

[sufford]

First of all, thanks for responding, VolvoGirl.  The amount so far is gross - no expenses figured in yet.  I just found it odd that the "tax to pay" was over twice that calculated from the actual income tax tables.

[fanfare]

You may pay 12% income tax after deductions,

but  also 15% SE tax - Schedule SE.

@sufford 

[rjs]

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@sufford wrote:

I just found it odd that the "tax to pay" was over twice that calculated from the actual income tax tables.

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What you are calling "tax to pay" is income tax plus self-employment tax. If $35,926 is your only income (or the only income you have entered), you're in a low enough tax bracket that the self-employment tax rate is higher than the income tax rate. Also, if you did not make estimated tax payments during the year (or have not entered your estimated tax payments), the "tax to pay" might include a penalty for underpayment of estimated tax.

[sufford]

Thanks to everyone. I’m good now.  Happy Taxes from Texas!