Question on Selfemployment Tax

[runner15]

What is the name of your state? Florida

I am trying to fill out my Self-employment tax for 2006. Box 2 states net profit or loss from Schedule C. Part 2 box 9 is my dilemma. My accountant stated that when filing SE Tax you can only expense expenses that help run the business. I am a 1099 Contractor and Part 2 box nine is for expensing mileage. Do I take it now filing my quarterly tax or the end of the year April 15 2006?

[LdiJ]

Originally Posted by runner15

What is the name of your state? Florida

I am trying to fill out my Self-employment tax for 2006. Box 2 states net profit or loss from Schedule C. Part 2 box 9 is my dilemma. My accountant stated that when filing SE Tax you can only expense expenses that help run the business. I am a 1099 Contractor and Part 2 box nine is for expensing mileage. Do I take it now filing my quarterly tax or the end of the year April 15 2006?

I am a little confused...

Your business income and expenses would both go on schedule C, and you would file that with your 2006 tax return, not with your quarterly estimated taxes. You also would not file a schedule SE with your quarterly estimated taxes either.

Mileage is a fairly standard expense that would also go on your schedule C.

Quarterly estimates are just that, estimates. The 4 quarterly payments are supposed to be estimated so that they come very close to what your tax would be for the full year.

[runner15]

So am I, that is confused. Do I not use Schedule SE to fill out my quarterly tax, I am doing this for the first time, and if not what form do I use to fill out my quarterly estimated taxes?

Thank You,

[LdiJ]

Originally Posted by runner15

So am I, that is confused. Do I not use Schedule SE to fill out my quarterly tax, I am doing this for the first time, and if not what form do I use to fill out my quarterly estimated taxes?

Thank You,

There really isn't a specific "form" that you use to figure your quarterly estimates. Quarterly estimates are based on either previous year's figures or a reasonable estimate of current year figures.

Self employment taxes (ss and medicare) are going to equal approximately 15 1/2% of your gross income. Regular income taxes will vary dramatically depending on your overall tax situation and marginal tax rate.

It would probably be in your best interest to consult with a local tax professional. You don't have to spend big bucks on that.

However, I would probably advise someone to at least pay in 30% their first year.