What Percentage of your income is withheld for Taxes?

Question

If I am a private contrator for a company, what percentage of my income should I be setting aside for taxes?

Well I live In Arizona, what are the fed, and state tax rates here?

Answer 1

Check out this withholding calculator on the IRS' website. This should help you out.

Answer 2

If you are in a state without income tax, and you earn less than $95K, I recommend saving at least 40-45% of your gross pay! If you are at the lower end of the scale, you can save 5 to 10% less than that.

If you are in a state with income tax, you may have to save 2 to 8% more, depending on the state. States with flat tax are easy. Some states have progressive tax rates up to 10%

Avoiding penalties is one thing. Making sure you have enough by April 15 is another!

WealthBuilder
Tax Specialist

Answer 3

Depends on how much you make. If you are bringing in $500K your percentage will be much higher than if it is $50K. AN d like someone else said, don't forget self employment taxes. People for get about those and get screwed.

Answer 4

depends. if you make less than 175k then you pay what you paid last year and you wont have penalties. 0-100k about 25% plus .0765 for unemployment and medicare. this needs to be paid usually monthly or quarterly depending on your income. Get a CPA before you get into tax trouble.

Answer 5

Figure out what your state and federal taxes would be, and then add 15.3% to that for self employment tax.

Answer 6

It depends on whether or not you are self-employed, deductions, exemptions, and state you live in. Beccause you are asking in this venue, I would suggest you consult a tax expert in your own state.