Self Employment Tax Lawyers in Hampden
In Hampden, Maine, some taxes are enforced on employees, and deducted from their paychecks. Most people are cognizant of the Medicare and Social Security taxes - which fund those two programs by taking a small percentage of every paycheck an employee receives.
It's essentiall to be aware of one fact: if you're self-employed, you still have to pay these taxes. And it's your responsibility (or the responsibility of someone you hire for this purpose) to figure out exactly how much you owe.
Most often, employers handle all of these calculations. With regular salaried and hourly employees, this is an easy procedure, and any decent payroll computer software can do it automatically. But, if you work for yourself, it is your responsibility to figure out exactly what you owe.
Self-Employment tax obligations in Hampden, Maine
If you derive even a small percentage of your income from running your own business, or working as an independent contractor, you have to pay the "self-employment tax." This tax applies to everybody who makes more than per year from self-employment.
People 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 obtaining, on your behalf, twice as much money as what's deducted for your paycheck, with your employer covering the other half.
But, if you're self employed in Hampden, Maine, or anywhere else, you are required to make the employee AND employer contributions to Social Security and Medicare, effectively doubling your employment tax liability.
Currently, the self-employment tax rate in the United States is 15.30% of all income earned from self-employment in Hampden, Maine. Nonetheless, half of your hypothetical self-employment tax liability can be deducted from your income. This means that you only pay self-employment tax on about 92% of your income, which creates an effective self-employment tax rate of just over 14%.
Can a Hampden, Maine Tax Attorney Help?
If you're self-employed in Hampden, you need to keep thorough 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.
So, if you have some trouble figuring out what you owe in self-employment taxes, for whatever reason, chances are good that a qualified tax attorney in Hampden, Maine can help you with much trouble, and can provide you with good legal and financial advice, which can help you head off much more serious legal and financial issues.