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Thread: I thought I was saving enough for taxes...

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    Duh I thought I was saving enough for taxes...

    So, 2017 was my first year dancing. I live in Louisiana, and thought I was saving enough for this upcoming tax season. As of right now it looks like I owe 34%!?!?

    I made 36k. I have about 3k in itemized deductions, and the personal exemption is 4k. I've been saving 25-28% and I'm getting kind of worried. I have enough in savings for 28%. Can someone please clarify the whole SSI/Medicare taxes, federal income, and state income? I have enough money to my name to cover the full 34%, but it's still giving me anxiety. Someone please help

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    Default Re: I thought I was saving enough for taxes...

    That looks about right. Figure on a third for taxes etc Dont trust accountants, they will get you in trouble underestimating.

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    Featured Member Zofia's Avatar
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    Default Re: I thought I was saving enough for taxes...

    Here is a reasonably accurate tax calculator: https://www.hrblock.com/tax-calculator/#/en/te/aboutYou

    If you made $36,000 and are single, no dependents you should owe about $2600 in federal income taxes and $4700 in self-employment taxes. That assumes you have health insurance. If you don't, you'll owe a penalty on top of your other taxes. You will also owe state income taxes to Louisiana and if you work in more than one state, you might owe other states some income tax too. My estimate is your Louisiana income tax is going to be about $850.

    Self-employment taxes are basically the employee and employer share of social security and medicare. It comes to 13.1% of the first $127,000 of earned income. The medicare portion continues regardless of income. But, you're not there yet.

    Also, my calculation above is predicated on you not having any other income. If you do, then everything is off.

    This year, you got by with not filing quarterly returns because the IRS has a rule that exempts taxpayers from quarterly filings the first year they are in business. Now you need to file quarterly returns for both Louisiana and the U.S. Go see a CPA or Enrolled Agent. They will set your books up for you and show you how to file quarterlies and your annual return. It's money well spent.

    HTH
    Z

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    Default Re: I thought I was saving enough for taxes...

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    Last edited by Izziee; 01-04-2018 at 08:05 PM.

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    Default Re: I thought I was saving enough for taxes...

    Oh, but I did work a minimum wage job from January-May, as a hostess. Will that really throw off my taxes since that job's pay was already taxed? I wasn't making much, maybe 400 every two weeks, at most.
    Last edited by Izziee; 01-05-2018 at 10:29 AM. Reason: Talked to a CPA, he said no it will not.

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    Featured Member Zofia's Avatar
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    Default Re: I thought I was saving enough for taxes...

    Your minimum wage job will be taxed, but you are already withheld so there is some money to pay the tax. Put your numbers in the tax calculator I provided and see what the final answer is.

    HTH
    Z

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