federal tax help

Yes, you need to pay quarterly or run the risk of paying a penalty for not doing so. The .pdf form (1040 ES) can be downloaded/printed at IRS.gov and next year, the treasury will probably send you pre-printed stubs for that year's payments. No carrier is going to withhold and submit for an owner-operator or contract lease operator that I know of. All you can do is estimate what you may end up netting in terms of actual profit and maybe sending in 25% of that spread out over 4 payments every quarter.

And don't forget about the additional Self employment income tax (medicare and social security) and as a "top earner" with gross income over $250k, Obama will be eagerly awaiting to hear how much you actually netted and will want to know how in the world you can show a net of only $50k with a gross of $250k

 

1040-ES for 2013 - Google it...

www.irs.gov/pub/irs-pdf/1040es.pdf

 

I'd save about 25% should be pretty close to break even on personal and business taxes. A separate account just for this makes things easier. There are no rules saying you can't save more. Look at it as a floating account.

It's been years ago since I had a business but I had my bank make my IRS payments for me. All I had to do was put money in the account or if they needed they would take a shortage out of checking. But then again I live in a small town. But you might ask yours. They know your money flow. If you haven't already keep your business and personal accounts separated.

 

you could also look into using QuickBooks or similar business accounting software, it will help you with the estimates and I think you can make quarterly payments via it also.

 

Depending on the income, 15.3 % for the social security tax, 15% for the federal income tax, unknown state, easily could reach 30%.

Business payments for payroll taxes have to be done electronically now through EFTPS. They have not made the personal estimates that way yet.

 

I live in TN so no state tax and I will start my O/O career on 4/17...lol Roadmedic, you seem very tax smart so, when I start in July my 1st payment will be due. The 30% I pay is from the amount after fixed/variable,,,correct?

 

I just went to the IRS.gov site and what do I see at the far right, top? IRS.Gov En Espanol What bull that is...

 

The taxes based on the estimated net are always due
04/15
06/15
09/15
01/15

So when you start April 1 you will be basing the tax projection for April through April and May.
September payment is for April to August less tax paid in in June
And so on.

This in just the business calculation and does not consider what may have happened in the first quarter. If withholding was done, it flows for the whole year.

 

Man, this stuff is killing my mind.... I will be starting 2nd week of April this year. I have the PDF for the 1040 ES up now and am reading it. If I start or get my first settlement on, or after, April 17th than I will start paying estimated on 06/15...right?

 

Pretty much.

You can pm for help along the way. Things remain confidential then.