| What do independent contractors do for Taxes? |
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Azarbo
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Location: UK
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| What do independent contractors do for Taxes? |
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I made (and reported) $ 6,000 as an independent contractor last year. I also made an additional $ 10,000 and paid taxes(Claiming zero dependents). Is their a way, in the future, to not get burned with a (approx) 18% tax on the independent contractor side?
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Sun May 15, 2005 6:32 pm |
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jlee1224
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Location: Baltimore
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You can up your dependents on your W2 job, which will lower the amount of taxes taken from your 10k. Just make sure that at the end of the year, you'll have paid 90% of your tax liability or more, or you may have to make a periodical payment, which is a pain (because you have to keep doing it).
IF you make 16k total, your tax liablity is only going to be around $800 for the year. 18% of your $6000 is $1080, so if you paid no taxes on your $10k, you'd be due a refund of at least $280 (I'm using 2005 tax tables, and standard deduction/exemption, single, no children).
Go to your W2 job, and put "EXEMPT" on the tax form, so they won't take any taxes out.
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Thu May 26, 2005 2:48 pm |
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