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    mangomary's Avatar
    mangomary Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Aug 18, 2008, 12:36 PM
    How do I figure the % of taxes I pay?
    I am applying for a job with a new company. They informed me that this will be a "1099" position. When we discuss salary, how much % do I add so that I am not only getting a fair salary but also paying the appropriate Federal taxes? I live in California and what % do I also add for State? Mary
    MukatA's Avatar
    MukatA Posts: 7,110, Reputation: 176
    Tax Expert
    		  
    #2

    Aug 18, 2008, 08:59 PM
    You are independent contractor. The 1099-Misc income is reported on schedule C or C-EZ (Form 1040). You can deduct job/business related expenses. Net income is subject to SE tax at 15.3%.
    How you will treat the 1099-Misc income, read: Your U.S. Tax Return: W2 vs 1099-Misc: Employee vs Independent Contractor.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #3

    Aug 20, 2008, 07:16 AM
    If your position were a W-2 position, your FICA taxes would be 7.65%.

    As a 1099 position, the self-employment tax is exactly TWICE that amount, at 15.3%.

    BOTTOMLINE: YOUR tax liability is about 8% higher, so your income level should be at least that much greater to compensate.
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