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TAXES
Savvy strategies to help reduce your taxes
Self-Employment Taxes
Self-employment tax is a Social Security and Medicare tax primarily for individuals who work for themselves. If you’re a new sole proprietor, you need to know all you can about how and when to pay self-employment taxes. The IRS can help with a special article devoted to the topic. Here’s what you’ll find covered in the article:
- What is self-employment tax?
- How to pay self-employment tax
- Estimated taxes
- Who must pay self-employment tax?
- Earned income tax credit
Roth IRA Confusion
Roth IRA contributions aren’t tax deductible and aren’t reported on your tax return. On the other hand, you’re not taxed on any qualified distributions when you begin withdrawing money from a Roth. How much you can contribute to Roth is determined by your income limits, age and other factors. It gets confusing for many taxpayers. To help untangle the confusion, you can turn to IRS Publication 590, Individual Retirement Arrangements, available on the IRS Web site. You can also take a look at the online Success Skills Seminar Retirement Plans For The Self-Employed. It’s available for free from the National Association for the Self-Employed.
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