How do you figure self employment taxes and charitable donations?

[de3ik]

What is the name of your state (only U.S. law)? Michigan

Hi. I have posted in the threads below about my situation concerning being self employed and how it would affect my situation. Please give your advice if you can...

https://forum.freeadvice.com/landlord-tenant-issues-42/i-live-section-8-how-should-i-deal-starting-small-business-585993.html#post3117242

https://forum.freeadvice.com/social-security-disability-ssi-law-70/how-do-your-earnings-affect-your-ssi-income-585995.html#post3117253

I desire to become self employed as an affliate marketer through the Amazon Affiliate program. I know they desire a tax ID and I believe this is for tax reporting purposes? With earnings such as this am I correct to believe that you receive a form once you exceed $600 for a calendar year? Please clarify for me because I believe situations like online selling and the like are required to reported to the government as taxable income once you exceed $600 and you are considered a business rather than a hobby. (Is that true?)

My question is I know you have to pay taxes based on your tax bracket. And I know you have to pay self employment taxes. I am very unclear on self employment taxes. I currently receive SSI and if I made say $100 a month I believe this would be in the 15% bracket, but am not sure how much a percentage the self employment taxes would be. What percentage would employment taxes be for a 15% tax bracket? Is there an online calculator that would make this easy to calculate and get a good figure? Also how would charitable donations be figured in? (I donate $30 a month) I am hoping to learn this information so that I would have a better idea of how to do my taxes or understand them if I had them done by someone else.

Thanks

 

[Zigner]

As a sole proprietor, your social security number IS your tax id

 

[tranquility]

Don't focus on the law, focus on the reality. Anything else will cause a sleepless night. (Or, worse.)

 

[de3ik]

As a sole proprietor, your social security number IS your tax id

I know you can give your social security number, but I was told not to give this and to get a tax ID so as to keep my social security number private.

Don't focus on the law, focus on the reality. Anything else will cause a sleepless night. (Or, worse.)

I don't understand what that means, but all I know is I need some advice about how to do my taxes. This a forum referencing tax law and I want to know how to do it properly. I don't need anything, but real advice on how to the self employment taxes apply (the percentages etc.) and my other questions answered. Can someone please answer my questions as applies to the taxes? I really need that answered in a way that I understand.

Thank you

 

[tranquility]

Keep all your threads in one place.

 

[ecmst12]

When you start actually making some money, go see a tax professional for instruction. Until you make money, you have nothing to worry about.

 

[de3ik]

Keep all your threads in one place.

I didn't think of all these questions at the same time and they aren't all the same topic, even though they are related. That's why I placed them in the different forums. It made sense to me to place different topics in different forums.

I know that I won't have to pay anything until I earn money, but I want to be prepared as my housing goes according to my income and if the taxes and rent are too high with the SSI cut factored in I won't be able to do this right now.

When you start actually making some money, go see a tax professional for instruction. Until you make money, you have nothing to worry about.

Where can I pursue FREE tax advice about self employment? I need to everything about this before I proceed.

 

[justalayman]

http://www.michigan.gov/business/0,4539,7-255-52647_49292-189544--,00.html


http://www.google.com/search?q=michigan+self+employment+taxes&oq=michigan+self+employment+taxes&sugexp=chrome,mod=9&sourceid=chrome&ie=UTF-8

 

[de3ik]

http://www.michigan.gov/business/0,4539,7-255-52647_49292-189544--,00.html


http://www.google.com/search?q=michigan+self+employment+taxes&oq=michigan+self+employment+taxes&sugexp=chrome,mod=9&sourceid=chrome&ie=UTF-8

I appreciate the links. If anyone has anymore or anymore advice on this topic please post it here. I am still open to your comments.

 

[LdiJ]

What is the name of your state (only U.S. law)? Michigan

Hi. I have posted in the threads below about my situation concerning being self employed and how it would affect my situation. Please give your advice if you can...

https://forum.freeadvice.com/landlord-tenant-issues-42/i-live-section-8-how-should-i-deal-starting-small-business-585993.html#post3117242

https://forum.freeadvice.com/social-security-disability-ssi-law-70/how-do-your-earnings-affect-your-ssi-income-585995.html#post3117253

I desire to become self employed as an affliate marketer through the Amazon Affiliate program. I know they desire a tax ID and I believe this is for tax reporting purposes? With earnings such as this am I correct to believe that you receive a form once you exceed $600 for a calendar year? Please clarify for me because I believe situations like online selling and the like are required to reported to the government as taxable income once you exceed $600 and you are considered a business rather than a hobby. (Is that true?)

My question is I know you have to pay taxes based on your tax bracket. And I know you have to pay self employment taxes. I am very unclear on self employment taxes. I currently receive SSI and if I made say $100 a month I believe this would be in the 15% bracket, but am not sure how much a percentage the self employment taxes would be. What percentage would employment taxes be for a 15% tax bracket? Is there an online calculator that would make this easy to calculate and get a good figure? Also how would charitable donations be figured in? (I donate $30 a month) I am hoping to learn this information so that I would have a better idea of how to do my taxes or understand them if I had them done by someone else.

Thanks

Self employment taxes are just over 15% of your actual profit from business. The rest of your questions would take a very long time to explain. I suggest that you get the instructions for form 1040, for Schedules C, A, and SE and read them.

 

[davew128]

Self employment taxes are just over 15% of your actual profit from business.

Not true. The tax is 15.3% of SE income. That's NOT the same as your comment and its not a minor difference.

 

[tranquility]

Not true. The tax is 15.3% of SE income. That's NOT the same as your comment and its not a minor difference.

Which is why the question cannot easily be answered.

 

[LdiJ]

Not true. The tax is 15.3% of SE income. That's NOT the same as your comment and its not a minor difference.

Dave, my explanation is easier for a layman to understand than yours, and in most cases of self employment, it IS a minor difference.

If someone has 10k of SE income at 15% its 1500.00

10k-400 X 15.3% = 1468.80

I think that is a relatively minor difference.

 

[davew128]

Dave, my explanation is easier for a layman to understand than yours, and in most cases of self employment, it IS a minor difference.

If someone has 10k of SE income at 15% its 1500.00

10k-400 X 15.3% = 1468.80

I think that is a relatively minor difference.

Still not getting it. It's not the 0.3% thats the issue. It's determining SE income, and no it's NOT the number from Schedule C. Your formula is also entirely incorrect.

lf employment taxes are just over 15% of your actual profit from business.

This is a false statement. That is not what SE tax is. Try .9235 of SE income X 15.3% (in most years). Not such a minor difference anymore.

 

[LdiJ]

Still not getting it. It's not the 0.3% thats the issue. It's determining SE income, and no it's NOT the number from Schedule C. Your formula is also entirely incorrect.

This is a false statement. That is not what SE tax is. Try .9235 of SE income X 15.3% (in most years). Not such a minor difference anymore.

Still pretty minor Dave...in this instance the difference is less than 88 bucks.