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Question

This is a question about self-employment estimated taxes. I started my freelance writing business earlier this year and am unsure how to calculate my estimated quarterly taxes. My husband and I have always filed jointly in the past; this is the first time we have not both held full-time positions with taxes automatically withheld. When I calculate my estimated taxes, should I be including his income as well, even though his current employer already takes out taxes? I understand the basics of figuring estimated taxes for a single self-employed person filing separately but don't quite understand how to calculate it in our situation. Thank you for your assistance.

Submitted: 18 days and 19 hours ago.
Category: Tax
Value: $15
Status: CLOSED
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State/Country relating to question: Illinois

Already Tried:
- I have read several articles and how-tos on calculating self-employment tax and estimated quarterly tax for self-employed individuals, but nothing seems to address what to do when you are filing jointly with a spouse who isn't self-employed and who already gets taxes withdrawn from his paycheck. Do we have to include his earnings for these quarterly calculations?

Posted by Robin D 18 days and 14 hours ago.

Answer

Hello XXXXXXXXXXX, When calculating your Self Employment Taxes for Estimated Taxes only use your income. This amount is only applicable to your income from your self employment. After you have all calculated then you can use a good site to calculate what your total tax will be for 2009. Here is a site that is very easy to use http://www.taxbrain.com/taxcalculator/default.asp I sincerely hope this information is helpful and best wishes on your new endeavor,

18 days and 11 hours ago.

Reply

Thank you for your assistance. I still am a bit confused though when it comes to figuring out my adjusted gross income with the standard deduction. I don't itemize, so should I figure in the single person standard deduction, rather than the married filing jointly deduction when figuring out my estimated quarterly taxes? (If I use the married deduction to calculate, I end up with a negative number total, so I guess that must not be right). Would really appreciate clarification on this point. Thank you!

Posted by Robin D 18 days and 11 hours ago.

Answer

When calculating for the self employment think only as single. You may find that at tax time when you and your husband file that your income added together puts you in a higher bracket. A good way to calculate what you need to know now is to look at your Gross income from the writing, subtract out any expenses you have incurred, this will be your net income. Conpute the tax on your net and then add your net to what your husband is expected to receive. Subtract your deductions and compute the tax (the taxbrain site I gave you is great for this part.) You will be able to see what your potential refund or balance due will be for 2009. Compute your SE Tax first though, because half of what you pay in SE Tax is used as a deduction on your 1040. Just remember you are the one with self employment so only the amounts that are from SE should be used when you calculate the SE portion then just add the incomes together when you want to calculate the household income. Here is a site that has a spreadsheet to use to calculate self employment tax http://www.smallbusinessbrief.com/articles/taxes/002317.html Let me know if you need more help before you click Accept,

18 days and 10 hours ago.

Reply

This is really helpful! Thanks so much! One last, potentially stupid question - my husband makes much more net annually than I will for 2009. When I use the taxbrain calculator to figure our joint 2009 refund/balance, do I count 1 exemption for spouse, or none (because we both work)? Thank you for leading me through all this. Taxes make my head spin :)

Accepted Answer

Use 2 exemptions on the calculations for the joint income on taxbrain. You each are counted on the return information.

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Expert: Robin D
Pos. Feedback: 100.0 %
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Answered: 11/4/2009

Senior Tax Advisor 4

15years with H & R Block. Divisional leader, Instructor

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