how do I deduct my own taxes if my employer is not deducting them?

Question

I have asked a similar question a few times, and I wanted to clarify my situation in the hopes of being able to get the most accurate answer. I was hired to work as a secretary for 40 hours a week at a rate of 8 dollars an hour. My employer told me that I will need to do my own taxes, and she will not deduct them for me. I will not be filling out a W4 form at work. I was told that I would need to pay my taxes quarterly. This is brand new to me, and I am worried. I am trying to figure out how much money I will need to take out of each weekly pay check so that I don't get into a situation of owing more taxes than I can afford to pay. My husband is not working, and we are on a very tight budget. I need to know how much to save each week for taxes, because every penny counts!

Answer 1

You should receive a 1099 from your employer (she is responsible for providing that to you).

You should budget around 15% of your income, or a little more, to pay in taxes.

Speak to a tax professional for help in filing. The nice thing is, since you're considered an independent contractor (due to the 1099), you'll be able to take some deductions. But again, speak to a professional.

Answer 2

This is a tricky question, from what you have described the person you are working for wants to pay you as an independent contractor. However, if he determines when you work and where you must perform your work. Then it sounds like you are more likely a true employee. The employer would prefer that you be a contractor, since he would not be responsible for the employer share of social security taxes and such. If you are truly independent then you would have to pay 15% instead of 7% for SS, plus other taxes. You would also be required to make these payments on a quarterly basis. I would first resolve the employee/contractor issue, then go see a professional to calculate your quarterly tax payments if needed.

Answer 3

First of all what your employer is doing is illegal. Your employer should be paying half of the social security and medicare tax. You are not a contractor if they tell you when to be there, what to do, certain hours etc.

At a minimum you need to hold back 15% for social security because you will owe this even if you do not have to pay federal or state income tax. This should be paid to the IRS quarterly (March, June, Sept. and Dec).

You need to keep up with every single expense you have toward working this job as you can count it against the income.

You will have to file a schedule C on your tax return. Because your husband is not working and your hourly wage I would be very suprised if you owe anything beyond social security.

Answer 4

If your employer is claiming that you are an independent contractor, and you are indeed such, then you are responsible for the federal taxes due. It is a relatively simple process to set up with the IRS. If you owe more than is allowed by the IRS on your 2006 taxes, then you will need to set up a quarterly payment schedule with the IRS for 2007. ( I do it every year without problem). The details are not difficult and are available on the attached link to the IRS site for estimated taxes. Also, check the same site for information on independent contractors to see if you are actually under these rules.

Answer 5

An person should not be deducting their own taxes unless they are self-employed or an independent contractor. Your employer can't just tell you to take out your own taxes. By law an employer has to take out taxes if a person is an employee. If he/she then you are not an employee and the employer has to issue you a 1099 to report on their own tax returns. If they don't do that, then they are defrauding the IRS which can lead to a whole world of trouble. www.irs.gov has all the information you need to fill out whatever forms necessary.

Answer 6

I believe you have two options. One, is to make out a estimated tax form with a TAX adviser and pay what ever he says you should pay each quarter. Two, you can file as "self employed" again see a tax adviser for the proper forms etc. In the past I have had to do both at different times.

Answer 7

If you worked when he said, showed up when he said, you're an employee, not an independent subcontractor. He's trying to take advantage. He should have been deducting taxes all along.
Call the Wage and Labor board. You can't lose. It's fraud.

Answer 8

In Florida we do not pay state payroll taxes, so you need to only pay federal and social security taxes. I would go to the IRS website and look up the procedures for a freelance worker.

Answer 9

You should fill out a 10-99! Is this a regular practice at your employers? Because unless your self-employed they should do it.....it just seems really odd!

Answer 10

Weekly paycheck, save $50 each week. See my explanation in your previous question.