Tax on 1099

Are you an employee or a contractor?

If you are being paid by 1099, then you are really a contractor so you don't have a boss.

 

Frankly, seek professional help with this, like an accountant, not other truck drivers. What works for some, does not work for all.

Maybe at least 1/3rd of your weekly check, in a savings account?

But I don't know of any real amount to set aside. Then you are adding in meals, and per deim, which I think that the meals ARE included in your per diem?

Seek a good accountant, that handles other truckers.

 

If you were paid on a 1099, hopefully you have been paying your quarterly estimated (20%) income tax and your quarterly 15.3% self employment taxes. If not you will be paying a penalty for all quarters not filed.
As to per diem(meal allowance), you are allowed a deduction of 80% of $59 for each day you spend away from home and have to take a 10 hour sleeper break. If you return to the same terminal each day, you are not allowed the M&E deduction.

 

Buzzard got it pretty well covered.

 

And YET ANOTHER one gets educated on the realities of living the "big life" as a "boss" ... the hard way. Would love to see how all this plays out in the end. Sad thing is, apparently the driver was a "boss" for a time and didn't even know it.

 

One word - CPA....

 

I worked for a guy once and was paid 1099 for two years. The first year was great for me. The whole year of 2012 I generated 165,000 for him and I was only recieved 22,300 for the entire year. I got pretty screwed. All of my paperwork was in his truck and when I went to receive it, he had got rid of it all, log books and etc. I took it as a pretty big loss, but learned from that situation tremendously.

 

Lets say you grossed 70ooo and had 300 full days on the road and to keep it simple we will not have any other supply deductions

So you perdiem deduction is 59x .80x300 = $14160 now this is your tax free money and is taken right off the top of the 70000 gross.

So now you have a net of 55480 as your taxable income

As a self employed person you have to pay 15.7 percent for Social Security tax so 55840 x .157 = 8766.80 is what you owe

in SS taxes

Now onto the federal income taxes

You are allowed to deduct 1/2 of the amount you paid in SS taxes off your net income so 55840-4383.44 =51456.56

51456.56 is your adjusted gross income ant the tax rate you fall into is 25 % but the good news is at 37450 you go into a 15 percent bracket .

So we take your 51456..56 and subtract 37450 and you end up with 14000.56 as your taxable income of 25 percent

So 14000.56 x .25 =3501.64 is what you owe for the 25 percent bracket

Now the rest of you income from 37450 down to 9226 is taxed at 15% so 37450 - 9226 = 28224 is your taxable income at 15%

28224 x .15 =4233.6 is what you owe for your 15% portion.

now bear with me we are almost done one last calculation.

Now we have your last 9225 dollars to be taxed at 10% so 9225 x .10 = 922.5 is what you owe for that portion .

So lets reiterate for your Social Security portion you owe 8766.80

For you adjusted income at a table 25% you owe 3501.64

For you adjusted income at a table 15% you owe 4233.60

For you adjusted income at a table 10% you owe 922.50



So your total owed in taxes is 17,424.54


So you grossed 70,000 and paid 17424.54 for total taxes and your net take home pay is 52575.46

 

http://www.thetruckersreport.com/tr...cking-forum/250931-ready-set-here-i-go-7.html

Post 63

on this page this guy really knows what he is doing with the numbers I did n't deduct the $10150 personal deduction as i was unclear if you could take that combined with a per diem deduction.