[dave_mwi]

Ok.

The IRS's site talks about estimating tax and tells you to use your 2006 Tax return to estimate for 2007.

My 2006 return is when I worked fulltime with a company - and in 2007 I'm going to be Self-employed. I am trying to figure out how much I will need to make in 2007 being self employed, paying estimated taxes, etc, as a self-employed contractor.

As an example, with a full time job paying 130K/year with benefits, etc, how much would I have to be paid a year as a contractor?

I can do the dirty work of all the math myself, but I'm a little foggy on the start of it all. Do I do a 2006 tax form for example as if I was paid 130k as a full time employee with all the dependents, all that - stating that no income tax was withheld and use the final number as a start for how much I paid on 130k salary?

How I determine exactly what the SE Tax is on a salary at X amount/year. I still can't find a good reference for this. Can I just do a tax form for the year of 2006, pretending I was paid 160K for example as a contractor only - and use that as a guide for 2007 - taking into account any changes listed in Pub. 553?

Then how do I get benefits figured out. Are there any benefits that I can get on my own? I just don't know. Dental, Medical, Life, etc. I guess I could estimate from my full time job, but I don't know how much they will cost when I get them on my own.

A good starting point would be helpful, or a good guide... thanks so much.

[Mobea]

A good rule of thumb in your income bracket would be to deposit 20-30% of your NET income PLUS 15% for social security and medicare. Basically, the only difference in paying taxes between working for someone else and being self employed is that you are paying both halves of social security and medicare. Federal income tax withhholding is the same either way. As far as benefits, you may qualify to pay for COBRA benefits with your previous employer or you can check with your local insurance agent as to what insurance you may qualify for on your own. You may also qualify to contribute to a SEP retirement account based on your net income.

[AtlantaTaxExpert]

Mobea's answer gives you a good starting point.

You may also try to use the Form 1040-ES worksheet on the File Taxes Online - Do Taxes FREE - File Taxes With TaxACT website.