Self-employed? You may need to pay taxes!

If you are self-employed you may need to pay the self-employment tax (SE tax). The SE tax allows you to contribute to the social security system and ensure you will be covered. Generally those who are self-employed with net earnings that are $400 or more or you have church employee income that is $108.28 or more, will have to pay the SE tax and file a Form 1040.

There are special rules and exemptions to this for aliens, fishing crew members, notary public, certain government employees, certain employees of foreign governments or international organizations, etc. Special rules also apply to those performing in-home services (caregivers) for elderly or disabled individuals.

It is important to remember that the SE tax applies even if you are receiving Social Security or Medicare already, no matter how old you are.

For more information on the SE tax, refer to Self-Employment Tax on IRS.gov. To obtain help with these forms and other self-employment tax situations, contact Account On Us today!

 

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