Employee Business Expense
Generally your freelance job will issue you 1099-MISC slips for earnings more than $600. The gross amount of your freelance jobs should be reported on IRS Schedule C along with the corresponding expenses. The net amount of this business income is subject to Federal tax and Social security taxes. The federal tax will be calculated on the tax bracket you fall into Also, the net amount of your business multiplied at .9235 multiplied at .133 will equal your social security tax. If wages exist the social security tax may be reduced. This calculation is done on IRS Schedule SE. The net business income will be subject to state tax depending on your state. Speak to your local CPA about the tax consequences of your freelance job(s).
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