Married filing joint, only one is self-employed

[Rockstar Dispatch]

Husband is self-employed, single member LLC. Wife is W-2. When filing quarterly to cover the LLC taxes, do we just focus on the self-employment income when figuring quarterly payments to send and ignore wife's income since she is W-2 and taxes are being taken out in her paychecks?

[dev145]

You need to consider wife's income  and any other income too when you calculate estimated taxes if you are planning to file a joint return. Remember only Self employment tax is based on business income but federal tax will be based on total income. 

[KNDavis]

Hi Rockstar Dispatch!

Since wife has W-2 employment and presumably has taxes withheld from her paycheck that cover her income, your quarterly estimated tax payments would only need to cover the husband's LLC income.  

Here are some things to consider when you determine the amount to pay for quarterly estimated tax payments. 

You may want to project what your total tax liability will be for your combined income, then subtract wife's withholding to determine the amount needed for quarterly estimated payments.  If wife's withholding is too much or too little for her income alone, it could affect the amount of estimated taxes necessary.  

Assuming you file a joint tax return, you'll want to estimate your combined tax liability, then subtract wife's withholding.  You don't want to calculate taxes for the husband's income as if it is the only income because you may not calculate enough tax because of the tax bracket that applies to your combined income.  

Thanks for participating in TurboTax's Ask the Expert event today.  I hope this information was helpful!

Sincerely,

Kimberly, CPA for over 30 years