What are you doing about taxes?

[jenseib]

Are you all saving a % out each month? I'm trying to figure how much to save.I don't want to get screwed at tax time, nor make my DH mad too! LOL!
Is 30% about right? Also with state taxes, I wonder if I should pay quarterly? I don't really know a whole lot about income tax, so not sure what the right things to do are.

[jenseib]

So no one is going to pay taxes? I thought this would be a hot topic. I asked in the newbie section too, and everyone is clueless there about it as well. I just don;t want to get stuck owing so much after the fact. So I MUST save for it now. I was thing like 33 % but on the newbie boord they are saying only 15 %. Do you have to pay SS? and state taxes? Anyone planning for this?

[sophiasmommy]

I never thought about it!!! I wish it weren't contract, but instead was at-will employee so they'd take out taxes!!!

Dang it! Thanks for asking this question.

I will keep up with this thread...

[draekan]

Well, since there's only a few months left for 2009, I was thinking of saving all contract money I make in a separate account till tax time and see how much gets taken. Or saving at least 50%. I want to be sure I have enough to cover them.

[jenseib]

Originally Posted by draekan

Well, since there's only a few months left for 2009, I was thinking of saving all contract money I make in a separate account till tax time and see how much gets taken. Or saving at least 50%. I want to be sure I have enough to cover them.

That won't work for me. This is being used for christmas gifts. LOL! I did find some old pay sutbs, and I think the average taken out of theose checks were around the 25% mark. So I guess thats what I will save for now.

[khakigirl]

A good friend of mine told me to save $60 for ever $400 you make. That's about 15%. She knows her stuff because she worked 100% as an independent contractor last year. She said that even though she made enough to be in the 25% tax bracket, all her expense deductions knocked her tax bill down to about 15% of what she made. I personally wouldn't save more than 25% and I would stay between 15 and 20%.

[jenseib]

Originally Posted by khakigirl

A good friend of mine told me to save $60 for ever $400 you make. That's about 15%. She knows her stuff because she worked 100% as an independent contractor last year. She said that even though she made enough to be in the 25% tax bracket, all her expense deductions knocked her tax bill down to about 15% of what she made. I personally wouldn't save more than 25% and I would stay between 15 and 20%.

But we don't have deductions? I guess I could use my internet service as a deduction. right? Anything else?

[khakigirl]

Originally Posted by jenseib

But we don't have deductions? I guess I could use my internet service as a deduction. right? Anything else?

Internet service is one deduction. If you have to upgrade your PC for any reason (software, RAM, etc), that's another deduction. I've also read that you can deduct things like a portion of your rent but I'm not sure how that works. When I worked for ChaCha last year, I deducted the cost of a new office chair because my other one was causing me serious back pain.

[jenseib]

Can we use printer ink as a deduction? I used alot of ink printing out all the rules, plus then I have to print my other deductions as well. I'm pretty sure you can.It's office supplies.. I hope!

[charmed]

There is a free website called outright.com try it.

But sure you probably have deductions.

Possibly:

Business License
Internet connection
Computer
paper
business supplies
office supplies
Home office

Many could be deductions or partial deductions. Go to the IRS.gov site and look under business. You might be surprised at what you can deduct.