Self Employment Tax in Fort Collins, Colorado

Find the right Self Employment Tax attorney in Fort Collins, CO

Self Employment Tax Lawyers in Fort Collins

In Fort Collins, Colorado, there are specific taxes that are levied on employees, which are deducted from their paychecks. The typically 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 extremely important to know that, if you are self-employed, you still have to pay those taxes, and it's also up to you to figure out precisely how much you owe, to confirm that you don't pay more or less than you are obliged to.

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 typically very simple, and any decent payroll software can automate this process. But the self-employed are liable for figuring this out for themselves, or hiring an accountant to do it.

Self-Employment tax obligations in Fort Collins, Colorado

If you work as an independent contractor, or operate a sole proprietorship, you are deemed to be "self employed." You are obliged to pay the self-employment tax if your total income from self-employment exceeds per year.

Persons who are not self-employed, and work for another person or company, have their contributions to Medicare and Social Security matched by their employers. This means that these programs are receiving, on your behalf, twice as much money as what's deducted for your paycheck, with your employer covering the other half.

But, the self-employed in Fort Collins, Colorado are responsible for making the employer AND employee contributions to those programs, essentially doubling what they would have to pay if they were employed by someone else.

The self-employment tax rate is 15.3% of all self-employment income, assuming your income from self-employment exceeds per year in Fort Collins, Colorado. But half of your self-employment tax liability can be deducted from your income tax. This results in a slightly reduced income tax bill, which partially offsets this additional tax burden. It essentially means that the self-employment tax only applies to 92% of your income, as opposed to all of it. This means that your effective self-employment tax rate is about 14%, as opposed to over 15%.

Can a Fort Collins, Colorado Tax Attorney Help?

If you're self-employed in Fort Collins, you need to keep accurate records of all your income and expenses from the operation of your business. This will make it much easier for you to calculate your taxes when they come due, and it will make it simpler for a tax attorney to give you good, useful advice, should you eventually need it.

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

Talk to a Tax Law Attorney now!

Life in Fort Collins

Fort Collins is a medium-sized city. It is a home-rule municipality, meaning that it is not part of any county, and the state of Colorado has delegated some of its authority to the city, which the city can exercise within its own borders. It has a population of about 137,000. Fort Collins is generally known as a college town, being home to Colorado State University. The city of Fort Collins frequently ranks near the top of Money Magazine's list of best places in the U.S. to live. Because of the large college-aged demographic, Fort Collins has a thriving music and art scene, as well as a large number of well-regarded microbreweries. Fort Collins has a healthy and diverse economy, with major employers such as Colorado State University, Hewlett Packard, AMD, Wal-Mart, and many others providing thousands of public and private-sector jobs, in a wide variety of fields. Given its size, diversity, and vitality, it should come as no surprise that, with all the business that's done in Fort Collins, there are sometimes legal issues. For that reason, it shouldn't be a surprise that there are many Fort Collins, Colorado lawyers who are very skilled. If you're facing a legal issue, a Fort Collins, Colorado lawyer can help.

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