Self Employment Tax Lawyers in Sparta
In the U.S., Sparta, Wisconsin included, almost everyone who is employed during most of their adult life is suitable for Social Security and Medicare benefits when they retire. These programs are supported by taxes deducted from the paychecks of most employees.
It's essential to note that if you are self-employed, you're still responsible for those taxes, and it's your responsibility to figure out what you owe.
Normally, the employer makes all the necessary calculations and deductions from a person's paycheck. If you are self-employed, however, you are required to make this determination, and to ensure that it's accurate.
Self-Employment tax obligations in Sparta, Wisconsin
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.
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, if you're self employed in Sparta, Wisconsin, or anywhere else, you are obliged to make the employee AND employer contributions to Social Security and Medicare, essentially 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 Sparta, Wisconsin. 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 Sparta, Wisconsin Tax Attorney Help?
If you're self-employed in Sparta, 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.
Thus, if you have some trouble figuring out what you owe in self-employment taxes, for whatever reason, chances are good that a knowledgeable tax attorney in Sparta, Wisconsin can advise you with much trouble, and can provide you with good legal and financial advice, which can help you head off much more significant legal and financial issues.