Question

Is our tax amount inline with the norm?

Forum|Forum|2 years ago
March 19, 2024
1 reply
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I am wrapping up my (married filing jointly) personal return.

We are both 100% self-employed with schedule k1s

Our reported income in $150k

Our taxable income is $105k

Our federal taxes are amounting to $33k

That's 31% of our income going to federal taxes alone.

Is that insane or normal? It doesn't align with most tax calculators I've checked out. Do I need to speak to an expert?

Not A Product Question

R

RobertB4444

It's not insane for self-employed people to pay that much, unfortunately.

When you are self employed your net income after expenses has self-employment taxes stuck on immediately. That's the social security and medicare tax on everything that you earned. In your case that $150,000 times 15% so $22,500 of the taxes you're paying are that.

Then the income is taxed federally. Married filing joint the tax on $105,000 is $13,715. The total on that is over $35,000 (it's been reduced because of your self-employment tax credit).

So, yes, it's about right.

@emy

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