How do you figure out the taxes you would pay filling out a 1099 at the end of the year?

Question

I just got a new job and I am going to be filling out a 1099 at the end of the year. How do I figure out what to put aside for the end of the year? Or do I just wait til the end of the year?
Thanks in advance for the help

Answer 1

You must not wait until the end of the year. You must not put aside the money until the end of the year. You must make estimated tax payments to the government starting no later than April 15 of the year (one year before you actually file). If you do not, then you will be required to pay penalties, in addition to the tax. See the Form 1040-ES's instructions for the required amount of estimated tax to pay and the address to which you must send the payments.

Answer 2

You don't just put it aside until the end of the year, you make quarterly payments during the year with form 1040ES. You'll have to calculate the amount based on what you expect to owe for the year, and if your income will be fairly even through the year, send 1/4 of it each quarter. The first quarterly payment is due on 4/15.



Without knowing anything about your personal situation like filing status, whether you're a dependent or have any dependents, and what deductions and credits you have if any, no way to help you with the amount - you could do a mock return using 2009 rates and rules and you are likely to be pretty close. In addition to income tax, you'll pay around 15% for something called self employment tax which is for social security and medicare. As a rough guess, figure 25-30% for federal, more if you make over around 60K. Depending on where you live, you might also owe state and/or local income tax. If you do, that would be additional and you'd also need to make quarterly payments to your state or city.

Answer 3

You never just wait.



Do a dummy tax return based on what you think you will make and start making estimated tax payments (the first is due 4/15 for 1/1/10 to 3/31/10).



If you can't do the math, then you need to put 15-30% aside for Federal and another 5-10% for state.

Answer 4

The IRS has a very helpful form for you to determine what your year end tax liability will be from self employment income, the 1040-ES. You can get it from their website -- www.irs.gov.



By the way, if you expect to owe more than $1,000 at the end of the year, you don't just put money aside to pay those taxes, you need to send in estimated payments. The 1040-ES will help you with that too.

Answer 5

unless you are paying someone who performs services for you you will not be filling out a 1099

you receive a 1099 possibly from people you performed services for and report those earnings plus any you did not receive a 1099 for, on a sch C and the Sch SE which is self employment tax

and on this in particular you need to file your Estimated taxes on April 15, June 15, Sept, 15 and Jan 15 next year on this year's anticipated taxes

the main part of which is your SE tax which is appro. 15.3% of your Sch C 'net'

however much this impacts your other income will be something you have to determine to ascertain how much you should pay estimated those four vouchers

failing to file estimated could result in a penalty for you

Answer 6

try this site (i've used it): http://infobusiness3.notlong.com/4AARhj8