If we make $1500 per week (contract labor) and we have 2 children (13 & 7), what percentage should my husband and I be putting away for taxes so that we don't over or underpay? We live in Texas.
2007-05-20 07:21:17 · 1 answers · asked by Tilly24 2 in Business & Finance ➔ Taxes ➔ United States
That depends on how many associated eligible business deductions you have. Assuming those are minimal, your gross income would be $78,000 for the year, and if you take the standard deduction and don't have additional adjustments or credits beyond the child tax credit, your federal income tax would be somewhere around $5400, plus around $11,900 for self employment taxes (social security and medicare) for a total of somewhere around $17,300 per year, about 22% of your gross. Additional deductions or credits could lower this.
You will need to make quarterly estimated payments to the IRS - if you don't, you'll get hit with penalties for under-withholding at tax time even if you pay all that you owe then.
Since Texas doesn't have a state income tax, you don't have any additional there.
2007-05-20 08:16:12 · answer #1 · answered by Judy 7 · 1⤊ 0⤋