#45: Navigating Self-Employment Taxes

Season #1

Episode 45: Navigating Self-Employment Taxes

If you are self-employed, you are responsible for paying self-employment taxes. What does that mean, are there ways to reduce that amount, and how do you actually do it?! Join Josh and guest cohost Emily Blain to discuss!

Top takeaways:

  1. Marginal tax rate: you’ve added one more dollar to your income; what is that dollar taxed at? Effective tax rate: when you look at all of your dollars, what is the weighted average tax rate on everything?
  2. The best way to predict how much you’ll owe is to do a projection (or have your financial adviser/tax professional) of your income for the year.
  3. Self-employed people aren’t taxed MORE, but you are responsible for both the employee and employer side of things, since you are both employee and employer.
  4. If you reduce your self-employment taxes, also known as social security taxes…you reduce your future social security benefits.
  5. Social security benefits include old age, survivor, and disability benefits, all of which are based on what you pay in social security taxes.

Want help building or growing a successful financial coaching business? Find resources below based on where you’re at in your journey: