If you own a growing, unincorporated small business, you may be concerned about high self-employment tax bills. The SE tax is how Social Security and Medicare taxes are collected from self-employed individuals like you. Self-employment tax basics The maximum 15.3% self-employment tax rate hits the first $168,600 of your 2024 net SE income. The 15.3%
Many people who launch small businesses start out as sole proprietors. Here are nine tax rules and considerations involved in operating as that entity.
Do you and your spouse run a successful unincorporated small business together? If so, you face some challenging tax issues. The partnership issue for spouse-run businesses An unincorporated business with your spouse is classified as a partnership for federal income tax purposes, unless you can avoid that treatment. If not, you must submit a Form
Depending on your entity type, you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by using an S corporation.
LLC members commonly claim that their distributive shares of LLC income aren’t subject to self-employment tax. But the IRS has been cracking down on LLC members it claims have underreported SE income.