Self-Employed Taxpayer

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Self-Employed Taxpayer

A taxpayer who derives his/her income from his/her own business or from work as an independent contractor. In the United States, self-employed taxpayers pay double the social security tax of employed persons, but are entitled to more tax deductions. One calculates self-employed income by taking one's gross income and deducting all business expenses. For example, a self-employed taxpayer working from home may deduct a certain percentage of his/her rent or mortgage and not pay taxes on that portion of his/her income. Self-employed income is reported to the IRS on Schedule C of the 1040 Form.
References in periodicals archive ?
The issuance also clarifies certain gray areas in the new law affecting personal income tax including the most buzzed about eight percent tax rate election available to certain self-employed taxpayers.
5-million self-employed taxpayers, this still leaves an estimated 6.
IRS fashions relief from the joint filing requirement in the case of spousal abuse or abandonment and makes a technical correction in the limitation on repayment of excess advance credit by self-employed taxpayers.
So the only time the LISA even matches pensions is for basicrate, self-employed taxpayers.
Self-employed taxpayers file Form 1040, Schedule C , Profit or Loss From Business (Sole Proprietorship), and compute this deduction on Form 8829, Expenses for Business Use of Your Home.
Furthermore, self-employed taxpayers should not overpay their estimated taxes in the year of the OIC.
However, as part of this package of reform, George Osborne indicated during the Autumn Statement that quarterly returns for SMEs and self-employed taxpayers could be a possibility.
For purposes of the self-employed health insurance deduction, California conforms to the federal deduction for self-employed health insurance premiums, including the amount deductible for self-employed taxpayers who are allowed the IRC Sec.
Some clients even put themselves on a payroll to take advantage of tax withholding systems, even though the IRS does not recognize self-employed taxpayers as employees.
Self-employed taxpayers often forget to report half of their self-employment tax on the form (or fill in the wrong number).
Because several different options exist for self-employed taxpayers who wish to create their own retirement plans, choosing the best option can be complicated.
For self-employed taxpayers, the threshold amounts are reduced by the amount of wages taken into account in determining the FICA tax of the taxpayer(s).

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