Could I have some taxes with that?
#1
Could I have some taxes with that?
I am self-employed. I write myself a modest paycheck every 3 months. Here is what I pay in taxes.
I pay 12.4% to social security
I pay 2.9% to medicare
I pay .4% to federal unemployment
I pay 14.5% to federal income tax
I pay 3.4% to state income tax
I pay 6.0% to state sales tax
I pay .9% to hidden taxes on gasoline, phone service, cigarettes, etc.
I pay 7.0% to local property taxes.
Folks, that is 47.5% of my annual income. Does this seem reasonable to everyone?
I pay 12.4% to social security
I pay 2.9% to medicare
I pay .4% to federal unemployment
I pay 14.5% to federal income tax
I pay 3.4% to state income tax
I pay 6.0% to state sales tax
I pay .9% to hidden taxes on gasoline, phone service, cigarettes, etc.
I pay 7.0% to local property taxes.
Folks, that is 47.5% of my annual income. Does this seem reasonable to everyone?
#2
RE: Could I have some taxes with that?
Actually, your figures are flawed, since you seem to be adding the last three items as if they're a percentage of your income, which they are not.
You can reduce your self-employed tax burden by filing under s-corp status.
You can reduce your self-employed tax burden by filing under s-corp status.
#3
RE: Could I have some taxes with that?
ORIGINAL: GermanStar
Actually, your figures are flawed, since you seem to be adding the last three items as if they're a percentage of your income, which they are not.
You can reduce your self-employed tax burden by filing under s-corp status.
Actually, your figures are flawed, since you seem to be adding the last three items as if they're a percentage of your income, which they are not.
You can reduce your self-employed tax burden by filing under s-corp status.
The tax amount from sales tax is calculated against disposable income, so my effective sales tax should be (100 - (47.5 - 6))/100 * 6 = 3.51%
So my actual total tax burden is 45.1%
Whether 47.5% or 45.1%, these percentages are very typical for the average person. The average person cannot claim s-corp status.
#4
RE: Could I have some taxes with that?
You're not considering your deductible expenses or investments. Also, you aren't considering tax deductions like medical expenses, dependants, mortgage interest, yada yada yada.
You pay a lot less taxes than you think. Now, go out and party with your new-found income.
You're welcome.
You pay a lot less taxes than you think. Now, go out and party with your new-found income.
You're welcome.
#5
RE: Could I have some taxes with that?
ORIGINAL: Lugnut
You're not considering your deductible expenses or investments. Also, you aren't considering tax deductions like medical expenses, dependants, mortgage interest, yada yada yada.
You're not considering your deductible expenses or investments. Also, you aren't considering tax deductions like medical expenses, dependants, mortgage interest, yada yada yada.
I have never paid much attention to taxes before. Life's circumstances have forced me to become self-employed. I write the checks that pay my taxes -- not my employer. People may much more taxes than they think.
#6
RE: Could I have some taxes with that?
Well, I expect my personal figure is about 10 - 15% less than yours, and I think that's quite reasonable. You could always move to Canada or GB for some perspective.