Self Employment Tax Lawyers in Charles

In the U.S., Charles, West Virginia included, almost everyone who is employed during most of their adult life is eligible 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 liable for those taxes, and it's your responsibility to figure out what 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 Charles, West Virginia

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

For ordinary employees, Social Security and Medicare payments are made in equal parts by the employee and employer. This effectively means that every employee's contribution to his or her future Medicare and Social Security benefits is matched by the employer.

However, self-employed workers in Charles, West Virginia must make both the employee and employer contributions. So, this means that the Medicare and Social Security tax liabilities apply doubly to the self-employed.

In Charles, West Virginia, self-employed business owners pay a self-employment tax rate of 15.3%. This is, of course, separate from, and additional to, whatever they pay in income tax. In an effort to partially offset this further tax burden, half of what one pays in self-employment taxes can be deducted from their income when filing their income taxes. This means that the self employed pay income taxes on, at most, 92% of their income. And it's probably less, thanks to all the other deductions they might qualify for. This deduction lowers the effective self-employment tax rate to 14%, rather than the "official" rate of over 15%.

Can a Charles, West Virginia Tax Attorney Help?

If you are self-employed in Charles, it's essential that you keep good records of your income and expenses, because a tax attorney will only be able to help you to the extent that you help yourself.

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 Charles, West Virginia 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.