What do i need to do to pay off taxes and my job don't automatically deduct them?

Question

i just got a new job, different from my last one, and my checks are gona be the gross what i make. What do i need to do in order to not get my crap repossessed in th future? I know i gotta save and keep records of every last paycheck i received, but what really do i have to do?

Answer 1

I think you need to pay your estimated taxes quarterly to the IRS.

Answer 2

You are what is referred to as an "independent contractor". When you file your taxes next year, you'll receive a Form 1099-MISC from your employer that should represent the amount of "gross" money you received from that employer. Hopefully, you'll have some work related expenses to subtract from that gross amount (uniforms, supplies, insurance, etc.) and these amounts will be reported on Schedule C of the Form 1040. So, for example, if you earned $10,000 gross from your employer and had $2,000 in expenses, your net taxable income would be $8,000. Now, the tax liability on that $8,000 is bad news. Since you're considered "self-employed", you're responsible for self-employment tax of 15.3% of your net taxable income, along with your regular income tax on that amount. If you're in the 15% income tax bracket, that means that you'll be paying a little over 30% of your net income in taxes (and that's not even including any state tax rate). Yikes! And if that isn't bad enough, you're also responsible for paying these taxes during the year right now to the IRS in the form of quarterly estimated payments (Form 1040-ES).

I hope your hourly rate at this job is much higher than you would receive as an employee somewhere else, because you're going to pay a bundle in taxes. Also, you have no access to employee benefits like vacation pay, health insurance, unemployment and such when you're an independent contractor. Frankly, most independent contractors don't end up ahead unless they have a big business.

Answer 3

I think first you need to make sure your employer isn't supposed to deduct taxes. He cannot just decide you're an independent contractor, there are criteria that must be met. If you are paid on an hourly wage, that's a good clue they might be required to be deducted. Independent contractors are usually paid lump sum on a project basis (but there are other circumstances). You'd need to provide some details on your job for that.

Next, you would need to set aside twice the amount that would be deducted if you were a stautory employee because the taxes generally represent half of what is due.

Answer 4

If you are an employee, your employer is required to withhold taxes from your earnings. You fill out a W4 form that tells them what rate to use. If you are a contracted worker, you might have to pay quarterly estimates to the state and federal governements. That is easy to do and should be done 4 times per year. You can get the forms on your state website and IRS.gov

Answer 5

You need to estimate the amount of taxes that you will owe for the year, and then you need to send money to the US government quarterly on a 1040V (a payment voucher. It sounds like you will be considered a subcontractor, so you will need to pay all of your Social Security and Medicare taxes, plus an amount for federal taxes. You may need to consult an accountant if you are unsure of what to pay.

Answer 6

You have to make quarterly estimated payments to the IRS.

Another issue: If you are in fact an employee and not an independent contractor, then your employer must pay his half of the social security and medicare taxes.
If you're self employed, then you have to pay both halves (The Self-Employment Tax)

Answer 7

I would suggest that you find out how much taxes would normally be deducted from you if they was taken them, then once you get paid take that out of your pay and put it in a savings account so that when tax time come you will have the money to pay. Find out the precentage that should be taken out on you.

Answer 8

chill dude