Piedad Bassiti: The SE tax itself would be around $279 so would decrease your refund only that amount., But you also pay income tax on it, so that could explain it if you are in a 15% tax bracket.
Ileen Oshell: THANKS, EVERYONE!!
Derrick Kloke: If you are self employed, you should be able to deduct expenses related to your job which will in turn, up your refund.
Davina David: Because you have to pay a self employment tax. Self employment taxes are higher than regular taxes. Yes it sounds right. I had my refund reduced by over $700 due to self employment taxes last year.
Maritza Ebanks: Because you are, in effect, paying the income tax, Social Security and Medicare taxes that would be deducted if you were salaried.
Leontine Kreitz: Easy:15% Income Tax = $297Self Employment Tax = $28015% Tax Savings from Deducting 1/2 of SE Tax = $21$297 + $280 - $21 = $556 (Net Tax on $1980 in Self-Employment)(Sorry.....$1 off due to rounding)....Show more!
Gale Hartt: It is right. Because by being self-employed you have to pay both the employer and employee portions of taxes. Wayne Z is the man!
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