posted on February 24, 2001 07:25:54 AM
I'm thinking of getting into Ebay more seriously, and I was wondering about payroll taxes. I've never run a business, and if I'm the only employee, do I have to worry about payroll taxes?
posted on February 24, 2001 07:33:42 AM
If you are the only employee, there is no payroll therefore no payroll taxes. You do have to file a Schedule C (self employment) with your tax return as well as a Schedule SE for your social security tax. Keep in mind that no matter what deductions you claim your social security tax is determined by your Income less Supply. Not operating expense. When you are on someone's payroll your employer matches your Social Security contribution, however when you are self-employed you have to pay it all which is around 16%(give or take, I try not to think about this until April 14th or so). You do have the option of making quarterly tax payments which will make that April 15th check easier to sign. Here's a great site for your tax questions www.taxplanet.com. Good luck.
posted on February 24, 2001 07:35:57 AM
If you are self employed, you have to make quartley payments to the IRS -- most free tax advice is worth as much, or even less, than you pay for it and I suggest that you talk to a qualified prfessional.
Cheers, Jim.
Experience is the worst teacher. It always gives the test first and the instruction afterward
posted on February 24, 2001 07:42:35 AM
The tax law does not state that you MUST make quarterly tax payments if self employed. If you don't you are considered to have had too little witholdings and they will issue a penalty depending on the amount you owe when you file April 15th. My husband and I have been self employed for 20 years and have never sent in a quarterly payment. Our penalty is around 40.00. No big thing, the money sits in my bank earning interest and not in the IRS's account doing the same. The quarterly system sucks because the 1st payment is scheduled for April 15th. DUH, how can you pay your taxes and a quarterly at the same time? What ever, check out www.taxplanet.com. good luck
