Being your own boss has a lot of perks. Unfortunately, dealing with self-employment taxes isn’t one of them. Depending on your business, you may find it easier to work with a San Antonio TX CPA to make sure you pay your taxes on time and get the deductions that may be available to you. Still, it’s important to understand the basics of what is expected when it comes to self-employment taxes.
Because you’re working for yourself, you are the one responsible for paying your part toward the federal programs of Medicare and Social Security. The current self-employment tax rate is 15.3 percent, with 12.4% going to Social Security and 2.9% toward Medicare. All income is subject to the Medicare tax, but for 2023, income up to $200,000 is subject to the Social Security tax. Anyone earning at least $400 from self-employment is required to pay taxes.
When paying self-employment taxes, you need to file quarterly and use the IRS Form 1040, Schedule SE. You can pay online through IRS Direct Pay, using your Social Security Number or an Individual Taxpayer Identification Number. The quarterly deadlines for 2023 are:
- First Quarter: April 18, 2023
- Second Quarter: June 15, 2023
- Third Quarter: September 15, 2023
- Fourth Quarter: January 15, 2024
There are deductions available for self-employment, but this is where it may be helpful to work with an expert, as there are strict requirements for certain deductions, particularly when it comes to a home office. The space needs to be used solely for work, which often makes it difficult to claim. However, things like internet, phone, travel, education, insurance, and more can potentially qualify toward deductions.
Most self-employed people are too busy with their work to determine all of the requirements and deductions, as well as calculate quarterly income and make payments, which is why it is helpful to turn to an experienced San Antonio TX CPA. We can help you get the deductions you qualify for and take some of the extra burden off of you so you can focus on growing your business. Contact us today to learn more.Tags: Accountants San Antonio tx, CPA in San Antonio Tx, IRS Accountants San Antonio
This post was written by Gonzales Group CPA