How do i figure out how much taxes to take out of a check when its not deducted from employer?

Question

I just started a newspaper route and they dont dedcut taxes. I know if i dont take out the taxes when i cash the check i will be screwed when tax time comes. How do i figure out much money i need to take out each paycheck? Can someone help please

Answer 1

1. Most important is to find out if you are an employee or an independent contractor. Seems like you are not an employee.

2. If you are an employee, the employer must deduct social security and medicare taxes at 7.65%. Employer will also add same amount from his pocket and pay to the govenment.

3. If you are an independent contractor, your income (pay less your expenses) are subject to 15.3% employment taxes (at a rate 2 times 7.65%).

4. You may be required to make quarterly estimate tax payments so that your federal liability (for employment taxes and federal income tax) is below $1,000. You may also have to make estimated tax payments to your State.

5. With your tax return Form 1040, you will file schedule C (Form 1040) to report your income and expenses as independent contractor. If any tax is due, you need to pay with your return.

Answer 2

Sounds like you will receive a 1099 instead of a W-2. A good rule of thumb is to expect to pay 30% of your net (after expenses) income. You may have to send in quarterly estimates (if you think you may owe more than $1,000 when you file).

Make sure you do not need a business liscense (city/locality) and/or have to pay business taxes.

My experience is that newspaper routes are tough to make a profit on.

Answer 3

If you go to www.irs.gov you can find the tables for the federal taxes. You will have to roughly figure what you total income will be for the year. For your state taxes there will be a similar site for your state. You also might need to talk to someone about social security. If you employer isn't doing anything you might be on the hook for the entire amount. Also, depending on what your annual income will be you might need to make quarterly estimated payments to the government.

Answer 4

Many newspaper routes do not make enough to take taxes out but
Talk to the payroll department and ask them .
They can explain it better and if you need taxes taken out ,
They would be able to do the correct amount .

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Answer 5

Sounds like you need to make quarterly tax payments to the IRS. Check out Form 1040-ES. http://www.irs.gov/pub/irs-pdf/f1040es.pdf

You didn't mention what state you're in. If it is one of the 41 that taxes wages, then you should visit your state's department of revenue's web site to find out about state quarterly tax payments.

Answer 6

IF I MAKE $5000000.00 FROM INTERNATIONAL BUSINESS WHAT TAX DO I PAY