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Self Employment Tax

Key 2024 inflation-adjusted tax parameters for small businesses and their owners

Federal Taxes, Inflation, LLC, Ordinary Income Tax, Partnerships, Past-Through Entities, S Corporation, Self Employment Tax, Small Business, Small Business Owners, Small Business Tax Tips, Sole Proprietors /

The IRS recently announced various inflation-adjusted federal income tax amounts. Here’s a rundown of the amounts that are most likely to affect small businesses and their owners. Rates and brackets. If you run your business as a sole proprietorship or pass-through business entity (LLC, partnership or S corporation), the business’s net ordinary income from operations […]

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The Social Security wage base for employees and self-employed people is increasing in 2024

Employees, Federal Taxes, Medicare Taxes, Self Employed, Self Employment Tax, Social Security, Social Security & Medicare (FICA) taxes, Taxes 2024 /

The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $168,600 for 2024 (up from $160,200 for 2023). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Basic details. The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees, and self-employed

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Investment swings: What’s the tax impact?

(LTCG) Net Long-Term Capital Gain, 401K, Capital Gains, Federal Taxes, Investment, Investment Income Tax (NIIT), Roth IRA, Self Employed, Self Employment Tax, Simplified Employee Pension (SEP), Stock Market, Tax Planning, Tax-Deferred Retirement Accounts, Taxes 2023, Traditional IRA /

If your investments have fluctuated wildly this year, you may have already recognized some significant gains and losses. But nothing is decided tax-wise until year-end when the final results of your trades will reveal your 2023 tax situation. Here’s what you need to know to avoid tax surprises. Tax-favored retirement accounts and taxable accounts. If

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Spouse-run businesses face special tax issues

Federal Income Tax, Partnerships, Self Employment Tax, Social Security & Medicare (FICA) taxes /

Do you and your spouse together operate a profitable unincorporated small business? If so, you face some challenging tax issues. The partnership issue. An unincorporated business with your spouse is classified as a partnership for federal income tax purposes unless you can avoid that treatment. Otherwise, you must file an annual partnership return, on Form

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Use an S corporation to mitigate federal employment tax bills

Federal Employment Tax, FICA, Medicare Taxes, S Corporation, Self Employed, Self Employment Tax, Small Business, Social Security Tax /

If you own an unincorporated small business, you probably don’t like the size of your self-employment (SE) tax bills. No wonder! For 2023, the SE tax is imposed at the painfully high rate of 15.3% on the first $160,200 of net SE income. This includes 12.4% for Social Security tax and 2.9% for Medicare tax.

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Choosing an entity for your business? How about an S corporation?

C Corporation, Qualified Business Income Deducton (QBI), S Corporation, Self Employment Tax, Shareholder, Small Business, Small Business Tax Tips /

If you’re starting a business with some partners and wondering what type of entity to form, an S corporation may be the most suitable form of business for your new venture. Here are some of the reasons why. A big benefit of an S corporation over a partnership is that as S corporation shareholders, you

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Important tax aspects of operating your business as a sole proprietor

Business Deductions, Business Expenses, Health Care Insurance, Home Office Deduction, Itemized Deduction, Past-Through Entities, Self Employment Tax, Small Business, Small Business Owners, Sole Proprietors /

If you’re in business for yourself as a sole proprietor, or you’re planning to start a business, you need to know about the tax aspects of your venture. Here are eight important issues to consider: 1. You report income and expenses on Schedule C of Form 1040. The net income is taxable to you regardless

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Employers: The Social Security wage base is increasing in 2022

Employees, FICA, Medicare Taxes, Payroll Tax, Self Employment Tax, Small Business, Social Security & Medicare (FICA) taxes, Social Security Administration, Social Security Disability Insurance (SSDI) /

The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $147,000 for 2022 (up from $142,800 for 2021). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Background information. The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees, and self-employed

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An S corporation could cut your self-employment tax

C Corporations, Corporations, Employment Tax, Federal Income Tax, Income Tax, Internal Revenue Service (IRS), S Corporation, Self Employment Tax /

If your business is organized as a sole proprietorship or as a wholly-owned limited liability company (LLC), you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by conducting business as an S corporation. Fundamentals of self-employment tax. The self-employment tax is imposed on 92.35% of

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How business owners may be able to reduce tax by using an S corporation

Limited Liability Company, LLC, Medicare Taxes, S Corporation, Self Employment Tax, Small Business, Social Security /

Do you conduct your business as a sole proprietorship or as a wholly-owned limited liability company (LLC)? If so, you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by using an S corporation. Self-employment tax basics. The self-employment tax is imposed on 92.35% of self-employment

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