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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 10:02 AM   #21
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Re: Taxes for the Self Employed - Help!

P.S. I chose a SEP-IRA over an 401K for simplicity, so look into that too.
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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 10:09 AM   #22
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Re: Taxes for the Self Employed - Help!

Quote:
Originally Posted by TromboneAl
Funny story related to this: DW went down the accountant's office to get a lesson on how to do the payroll taxes.* She was tutored by an assistant named Mary.* While they were working, the accountant's dog, named Sadie, was in the office.

A week later my wife called with some questions, but got the names mixed up, and asked "I have some questions about the payroll, could I talk with Sadie, please?"

We still laugh about this!
We had a neighbor who mixed up my name and our dog's name. I didn't notice for a while because Judy the dog and I were usually together when talking to the neighbor so if she said hi Judy I thought she was being dog friendly.
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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 02:11 PM   #23
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Re: Taxes for the Self Employed - Help!

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Originally Posted by Laurence
Geeze, it looks like we'll be handing over ~43% of what she makes to the Feds, plus another 5% to California. That's depressing.
Jeez, are you certain? Is that harbor or what you calculated based on her income this year?

Is she paying for her own medical? That's deductible off the top. Supplies are too (computer equipment, gas to meet clients, long distance calls, etc.) with certain conditions.
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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 02:28 PM   #24
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Re: Taxes for the Self Employed - Help!

Well, that's the worst case, we haven't deducted anything yet, I'd rather start with worst case and go from there.

She's on my medical.
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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 02:49 PM   #25
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Re: Taxes for the Self Employed - Help!

I did some contract work for a firm at one point and had to file as self-employed - the taxes were a shocker! Almost enough to make me not do any more work. Then I opened a SEP-IRA and put the money there.

Laurence, didn't your wife work at the beginning of the year? Did she cash out remaining options or anything when she left? I'm asking because if she has already paid the maximum in Social security then she would be off the hook for this year. (or only responsible for the 15% chunk up to the max)

About the dog names: The vet's office called and left a message to remind me of the appointment to get MY anal glands checked - she'd gotten our names mixed up.
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Re: Taxes for the Self Employed - Help!
Old 07-06-2006, 03:10 PM   #26
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Re: Taxes for the Self Employed - Help!

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Originally Posted by eridanus
Jeez, are you certain? Is that harbor or what you calculated based on her income this year?

Is she paying for her own medical? That's deductible off the top. Supplies are too (computer equipment, gas to meet clients, long distance calls, etc.) with certain conditions.
15.3% plus 28% tax braket = 43% (plus state taxes)...I beleive it...I used to sit down at the end of the year and write 6 figure checks to the IRS...I don't miss that anymore...
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