The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/do-i-have-it-backwards-no-youve-got-it-right-24265254.aspx

Subject:  Re: Self employment tax Date:  6/23/2006  4:00 PM
Author:  ptheland Number:  87540 of 121114

Do I have it backwards?

No. You've got it right.

But if she's an employee, the FICA tax is due on the gross wages, before expenses.

If she's self-employed (and I don't think she is), the FICA taxes are due on the NET income from self employment. And we're talking about expenses that would reduce the net income to something close to zero. So there would be virtually no FICA taxes due.

--Peter
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us