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Lev
Lev, Tax Advisor
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Hello, i am a self employed contractor from PA (in the the

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Hello, i am a self employed contractor from PA (in the the heating and air conditioning field). I have 1 employee. Please give me a somewhat detailed list of all quarterly taxes i have to pay, the amounts in a percentage, and a short description of what the taxes actually are if possible. Thanks!
Submitted: 5 years ago.
Category: Tax
Expert:  Lev replied 5 years ago.

As self-employed - you need to pay estimate taxes to the IRS

form 1040-ES - http://www.irs.gov/pub/irs-pdf/f1040es.pdf - see due dates on the page 2; amounts are based on your estimated tax liability and divided equally.

and to PA DOR

form REV-413i - http://www.revenue.state.pa.us/revenue/lib/revenue/2009_rev-413i.pdf

 

Employment taxes:

federal income tax withholding

PA state income tax withholding - 3.07% -

FICA - social security 6.2% (up to wages $106,800 for 2009) and Medicare 1.45% taxes - each employer and employee.

FUTA - federal unempoloyment tax - 6.2% less credit for contributions to state funds up to 5.4% on first $7000 of annual wages.

SUI - state unemployment insurance (SUI) - paid to Department of Labor and Industry - rates range from 1.837% to 13.4784% (new employers should use 3.703% except construction employers)

SUI employee rate - 0.06% for 2008 is withheld from gross wages.

 

You generally must withhold federal income tax from your employees' wages. Employment taxes are paid to the IRS - to figure how much to withhold from each wage payment, use the employee's Form W-4 and the methods described in Publication 15, Employer's Tax Guide and Publication 15-A, Employer's Supplemental Tax Guide .

 

You withhold part of Social Security and Medicare taxes from your employees' wages and you pay a matching amount yourself. Withholding FICA tax rate is 6.2% for social security (up to )and 1.45% for Medicare. Both - employee and employer pay same amounts.

 

You report and pay FUTA tax separately from Federal Income tax, and Social Security and Medicare taxes. You pay FUTA tax only from your own funds. Employees do not pay this tax or have it withheld from their pay.

 

In general, you must deposit income tax withheld, both the employer and employee Social Security and Medicare taxes (minus any advance EIC payments), and FUTA tax by depositing electronically, mailing or delivering a check, money order, or cash to a financial institution that is an authorized depositary for federal taxes using Form 8109-B. You can also make your deposits using the Electronic Federal Tax Payment System (EFTPS). Some taxpayers are required to deposit using the EFTPS. See Publication 15, Employer's Tax Guide, under How to Deposit - Electronic Deposit Requirement.

 

In general, employers are responsible to report federal Income Taxes, Social Security, and Medicare taxes on Form 941, Employer's Quarterly Federal Tax Return and Instructions .

Employers who have an employment tax liability of $1,000 or less for the year may file Form 944, Employer's Annual Federal Tax Return and Instructions , instead of Form 941, Employer's Quarterly Federal Tax Return. Eligible taxpayers will be notified by mail.

Report FUTA taxes on Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return and Instructions .

 

City and school district income taxes and occupational privilege taxes - to obtain local tax forms or for assistance completing your local tax return, please contact your local tax collector directly. - http://munstatspa.dced.state.pa.us/MunicipalTaxInfo.aspx

 

Let me know if you need any help.

 

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 23177
Experience: Taxes, Immigration, Labor Relations
Lev and 2 other Tax Specialists are ready to help you
Customer: replied 5 years ago.
Thank you for your help, i will look into your answer tomorrow further.

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