Olive Branch, MS · Member since 2013 · 452 posts · 10 votes
Since we're here again for another Tax Season,
I'm just curious , as to know 100% what Tax Bracket someone falls in as a whole ( State, City and Federal ) ....all Combined
Is it 15% of your Income you should hold out ?
20 % ?
25% ?
This is just a question that I have never gotten an " Exact " answer to , but I would like to know to the " T " , via what Percent of my Income to hold out for Taxes
CPA · New York, NY · Member since 2016 · 203 posts · 132 votes
9y
Michael Dunn How long have you been self employed? Id strongly recommend sitting down with a CPA to discuss estimated tax payments. Basically, you may be subject to a penalty if you don't make estimated payments of 100% of the prior year's tax or 90% of current year's tax owed (the 100% changes to 110% if you are higher income).
Hope this helps
CPA · New York, NY · Member since 2016 · 203 posts · 132 votes
9y
Michael Dunn How long have you been self employed? Id strongly recommend sitting down with a CPA to discuss estimated tax payments. Basically, you may be subject to a penalty if you don't make estimated payments of 100% of the prior year's tax or 90% of current year's tax owed (the 100% changes to 110% if you are higher income).
Hope this helps
Polson, MT · Member since 2017 · 115 posts · 105 votes
9y
I have been self employed for a decade, I find that my net income usually gets taxed around 20% at $90k gross($75k net) You absolutely need to pay quarterly payments if you are self employed, and it will benefit you to have a professional do your taxes to help maximize deductions.
Investor and CPA · Arvada, CO · Member since 2015 · 2k+ posts · 3k+ votes
9y
Being self employed is not what determines your tax bracket. It's your overall income level. Source doesn't matter.
That said, being self employed, the very first tax you will pay is 15.3% of your profits as self employment tax. Note that this is also what you would normally pay as a W-2 employee through Social Security and Medicare and you normally pay this as 7.65% of your wages withheld from your paycheck. Your employer matches this amount.
Since you're self employed, you get to pay both your portion and the employer's portion, which is where the 15.3% comes in.
This is NOT your income tax bracket.
Tax brackets are determined based on your marital status and overall income level as follows:
2016 Federal Income Tax Brackets
Single filers
Married Filing Jointly or Qualifying Widow(er)
Taxable income
Married Filing Separately
Taxable income
Head of Household
Taxable income
Tax rate
$0 to $13,250
10%
$13,250 to $50,400
$1,325.00 plus 15% of the amount over $13,250
$50,400 to $130,150
$6,897.50 plus 25% of the amount over $50,400
$130,150 to $210,800
$26,835.00 plus 28% of the amount over $130,150
$210,800 to $413,350
$49,417.00 plus 33% of the amount over $210,800
$413,350 to $441,000
$116,258.50 plus 35% of the amount over $413,350
$441,000 or more
$125,936.00 plus 39.6% of the amount over $441,000
Married Filing Jointly or Qualifying Widow(er)
Married Filing Separately
Taxable income
Head of Household
Taxable income
Tax rate
$0 to $13,250
10%
$13,250 to $50,400
$1,325.00 plus 15% of the amount over $13,250
$50,400 to $130,150
$6,897.50 plus 25% of the amount over $50,400
$130,150 to $210,800
$26,835.00 plus 28% of the amount over $130,150
$210,800 to $413,350
$49,417.00 plus 33% of the amount over $210,800
$413,350 to $441,000
$116,258.50 plus 35% of the amount over $413,350
$441,000 or more
$125,936.00 plus 39.6% of the amount over $441,000
Married Filing Separately
Taxable income
Tax rate
$0 to $9,275
10%
$9,275 to $37,650
$927.50 plus 15% of the amount over $9,275
$37,650 to $75,950
$5,183.75 plus 25% of the amount over $37,650
$75,950 to $115,725
$14,758.75 plus 28% of the amount over $75,950
$115,725 to $206,675
$25,895.75 plus 33% of the amount over $115,725
$206,675 to $233,475
$55,909.25 plus 35% of the amount over $206,675
$233,475 or more
$65,289.25 plus 39.6% of the amount over $233,475
Head of Household
Taxable income
Tax rate
$0 to $13,250
10%
$13,250 to $50,400
$1,325.00 plus 15% of the amount over $13,250
$50,400 to $130,150
$6,897.50 plus 25% of the amount over $50,400
$130,150 to $210,800
$26,835.00 plus 28% of the amount over $130,150
$210,800 to $413,350
$49,417.00 plus 33% of the amount over $210,800
$413,350 to $441,000
$116,258.50 plus 35% of the amount over $413,350
$441,000 or more
$125,936.00 plus 39.6% of the amount over $441,000
Olive Branch, MS · Member since 2013 · 452 posts · 10 votes
9y
Linda Weygant ,
Thank You so much for your reply ....... Great information you posted and shared
A few Quick things please:
1. Assuming a Gross Yearly Income of $30,000
What then could someone expect to Pay as the TOTAL Dollar amount in Taxes for the Year on that amount of $30,000 ?
Would it be right around ....... $3,825 that would be owed in Taxes ?
And what about the Taxes we have to pay for the State / City we live in ? How do you Calculate this Number ? Is the Tax Rate based on a State/City basis or is it Nationally the same Tax Rate ?
Thanks so much again for all of your help, Can't Thank you enough - Michael