Question

If my wife already paid self-employment taxes during the year, why is she getting more taken out again when filing?

Forum|Forum|4 years ago
March 1, 2022
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TurboTax Self Employed Online

TurboTax is constantly updating the refund or amount due. If your wife paid estimated self-employment (SE) taxes and it wasn't enough to cover what she earned, that may be why TurboTax calculated more income taxes.

Make sure you enter your wife's SE taxes in the estimated section of TurboTax to get credit for paying them. See Where do I enter my estimated tax payments?

The SE tax rate is 15.3% with 12.4% for Social Security and 2.9% for Medicare. When you pay estimated SE tax, you also have to include the federal income tax and depending on all your income, the rate could be as high as an additional 37%.

Note: If you live in a state that has a state income tax, you may have to pay estimated taxes to the state.
The SE tax is reported on Schedule SE and also calculate the deduction that goes along with it.

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topherwAuthor

What seems crazy is she made $1986 on 1099-NEC…already had made her estimated tax payments for $302 during the year. Our overall tax refund was at $8774 before I put in her self-employment income. Once I put in her very low income, our refund dropped to $8043. That doesn’t make sense of such a drastic change in refund for such little income. Plus, we are way below the married joint income amount, so it’s not like her income threw us into a different tax bracket. Does any of that seem right?

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Cynthiad66

@topherw - On the surface, I agree with you that it seems very high. However, it all depends on your total income and tax rate. You can see the summary of the return buy using the link below.

How To View A Summary of My Return

Also, make sure, as stated by our expert, @HelenC12, you must make sure you enter the $302 estimated payment into the proper area to receive credit for that payment. Below is how to enter that payment.

If you made estimated tax payments in 2021 towards your federal, state, or local taxes, enter them in the Estimated and Other Income Taxes Paid section.