I make about 6000 dollars a year and don't pay taxes because of this low income. If I increase my income to 9000, will I then have to pay taxes? Oh, and I'm an independent contractor to a tutoring agency.
2007-09-25 08:39:22 · 4 answers · asked by curious 1 in Business & Finance ➔ Taxes ➔ United States
What state? What deductions? It seems unlikely, but you need to be more specific. You can call your state's taxing agency and get the forms for 2006 taxes - try using those forms and instructions to see what you'd owe.
2007-09-25 08:49:22 · answer #1 · answered by Mark Welch 5 · 0⤊ 1⤋
If you made over $399 as an independent contractor, you were required to file a return. You wouldn't owe federal income tax on an annual income of $6000, but would definitely owe self-employment tax (social security and medicare), so if you had that income last year and didn't file, do so as soon as possible - you are already late and in violation of the law, and might be hearing from the IRS if you don't take care of this.
If your income increased to $9000, you might or might not owe a small amount of income tax (maybe $25). If you have any allowable expenses (like for example book purchases) those would be deducted from your income before figuring your tax. For 2007, the limit for owing tax is $8750 if you are single, under 65, no dependents, and not a dependent, and take the standard deduction. You would still of course owe the self-employment tax.
Depending on where you live, there might be state income tax even on the $6000.
2007-09-25 10:05:14 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
1. If you make $6000 as an independent contractor, you are required to pay self-employment tax.
2. If the total of your deductions and exemptions is at least $9000, you will continue to be exempt from income tax.
3. If the total of your deductions and exemptions is less than $9000, you will have to pay income tax (in addition to self-employment tax).
2007-09-25 12:39:48 · answer #3 · answered by StephenWeinstein 7 · 0⤊ 0⤋
1) If you made $6000 last year as an independent contractor last year and you didn't file or pay, you have a surprise waiting for you. The minimum filing requirement for and independent contractor is only $400 annually. You probably owe some money.
2) Never let the tax consequences rule your decision making. Make as much money as possible.
2007-09-25 08:45:42 · answer #4 · answered by Wayne Z 7 · 3⤊ 0⤋