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April 14, 2025
Question

Paying correct percentage of taxable income?

  • April 14, 2025
  • 2 replies
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Hi all,

 

  We are filing a joint return with both wage and non-employee compensation (total income is approximately 50% each). After all deductions, our taxable income is in the $23,200 to $94,300 tax bracket and the federal taxes calculated are nearly 23% of the taxable income. Does that sound correct?

 

  I should mention that about half of the taxes calculated are due to self-employment. In other words, if all income was just from wages, then the calculated tax would be more like 12%.

 

  Thanks for any sanity checks you can provide.

    2 replies

    Employee
    April 14, 2025

    We don't know what product you are using--Online TurboTax or desktop software, which can make a difference when telling you where to look for things.   Or did you download/print your return?

     

    I'm a fellow user.  I'll ask for some more info that others may want to know, who may further comment.  Have you looked at your Form 1040 and Schedules 1-3?  What line of your Form 1040 are you referring to when you say "Federal taxes calculated?"   The total Federal tax is on Line 24, and the self-employment taxes are on Line 23.  Other taxes may also be included on Line 23.  The figure there on Line 23 comes from Schedule 2.

    Your return also likely has a Schedule SE, where the SE tax is figured.

     

    TurboTax says:

    "If you're self-employed, you're responsible for paying both the employer and employee portions of your Social Security and Medicare tax—a total of 15.3 percent on 92.35 percent of your net earnings from self-employment."   (That 15.3% includes 12.4% Social Security and 2.9% Medicare.)

     

    The Self-Employment Tax
    https://turbotax.intuit.com/tax-tips/self-employment-taxes/the-self-employment-tax/L8xXjolB4

    April 14, 2025

    Yes, you are in the 12% tax bracket for income taxes.

     

    As for your self-employment tax, this is on top on income taxes and is calculated at 15.3% on 92.35% of your net self-employed income.

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