Self Employment Tax in Surprise, Arizona

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In Surprise, Arizona, there are certain taxes that are placed on employees, which are deducted from their paychecks. The mostly well-known employment taxes are the Medicare and Social Security tax, for which a small percentage of every employee's paycheck is deducted.

It's crucial to note that if you are self-employed, you're still liable for those taxes, and it's your responsibility to figure out what you owe.

In most cases, employers make all the necessary calculations to determine how much needs to be deducted from an employee's check to pay these taxes. It's usually very simple, and any decent payroll software can automate this process. But the self-employed are responsible for figuring this out for themselves, or hiring an accountant to do it.

Self-Employment tax obligations in Surprise, Arizona

If you primarily work as an independent contractor, or are the owner of a sole proprietorship, you have to pay what's typically referred to as the "self-employment tax," if your annual income from self-employment is over $400.

For people who are employed by another person or company, the employer usually matches the employee's contributions to Medicare and Social Security. This effectively means that, when you look at your Medicare and Social Security tax statements on your paychecks, you can know that those programs are actually getting double what's shown there - with your employer covering the other half.

However, if you are self-employed in Surprise, Arizona, you are liable to pay both the employee and employer share of the employment tax. Effectively, this means that the employment tax for self-employed individuals is double what it would be for regular employees.

Self-employed workers in Surprise, Arizona pay a self-employment tax rate of 15.3% of their income that's derived from self-employment. However, half of whatever they end up paying in self-employment tax is deductible from income tax. This effectively creates a tax deduction of nearly 8% of one's income, requiring you to only pay taxes on 92% of what you earn. Additional tax deductions may lower that number further. When this deduction is taken into account, the self-employment tax rate is effectively 14%, as opposed to over 15%.

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Can a Surprise, Arizona Tax Attorney Help?

If you are self-employed in Surprise, it's extremely important for you to be diligent in keeping records of your income and expenses, to ensure that you pay all the self-employment taxes that you owe (and also to make sure you don't over-pay). You may one day need a tax attorney to help you with a legal issue, and they can help you far more effectively if you are able to quickly provide them with all the relevant information.

Anyone having difficulty with figuring out what they owe in self-employment taxes in Surprise, Arizona should seek the advice of a good tax attorney. Most tax attorneys also have a good knowledge of accounting, so making this determination probably won't be too hard for them. And on top of that, a competent tax attorney can give you objective and useful legal advice, which can help prevent more severe issues from arising in the future.

7 Tax Law cases posted to LegalMatch lawyers in Surprise

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Life in Surprise

Surprise is located in Maricopa County, Arizona.  Its population is one of the fastest-growing in the state- it went from 30,000 in the year 2000 up to 90,000 by the year 2007.  The city was founded in 1938 and was named after Surprise, Nebraska. 

Surprise is a popular destination for those seeking residential opportunities, in particular retirement homes.  In fact, much of the city's population growth can be attributed to Sun City Grand, which is a resort-like, age-restricted residential community.  The community is a large contributor to Surprise's population and economy.

Warm weather and modern sports facilities make Surprise an ideal location for those who love sports.  For example, the city maintains an outstanding Recreation Campus.  The Campus houses the Surprise Tennis and Racket Complex (STRC), which has received several awards.  STRC is often the site for important professional matches. 

If you have a legal claim, lawyers in Surprise, Arizona will usually file the claim at the Surprise Municipal Court.  The municipal court hears civil matters as well as criminal misdemeanor cases.  Surprise lawyers can provide you with advice or representation on a variety of legal issues. 

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