Is self employment taxes the same as federal income taxes?

Are they the same taxes that i need to pay?

Public Comments

1. If you didn't have social security and medicare taken out of your paychecks, then you need to pay self employment tax - that's what those are for. It's in addition to income tax.
2. Yes, they are basically the same. Self employment allows you to offset your expenses of doing business against your receipts, so the return is more complicated. But the end result is the same. You pay tax on your net profit exactly as you pay it on your salary.
3. Self employment taxes are your social security and medicare taxes you must pay since you are self employed. When you file a Sch. C, your net self employment income is computed. Then if this figure is at least $400 then you will file Sch. SE. Your SE tax is put on line 57 of the 1040. On the Sch. SE your social security and medicare taxes that are computed are actually twice the amount that you would normally have paid if you are paid wages on a W-2. Then one half of this amount is an adjustment to your income, on line 27 of the 1040, before your adjusted gross income is determined. So when self employed you are responsible for all the taxes, including the social security, medicare, federal, and possibly state and local. Laura H – H&R Block – Senior Tax Advisor 5 **This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.
4. No, if you're self employed you will still pay federal income taxes based on your net income but in addition you will have to pay social security tax on your income. When you're self employed, you have to pay the entire amount of social security and medicare taxes; employee's and employer's portion which totals 15.3% and adds up really fast.
5. No, they are different. Income Tax varies by bracket. Self Employment Tax is a flat 14.12955% SE Tax isn't due until Gross Earnings less Expenses exceeds $433.1348132. SE tax does have cap that changes every few years. Currently after a certain amount you only pay Medicare portion (2.67815%). Look for The Obamatard to try and change that.
6. They're not quite the same, actually! Your self-employment taxes are what you pay into Social Security and Medicare. When you work for someone else, you both pay for your social security and medicare (you will end up paying for all of it, but the paperwork makes it seem different). Federal income taxes are a bit different. You'll have to pay them no matter what. The difference is that if you're an independent contractor, you have to keep track of how much you earn, and set aside money to cover the taxes -- if you're an employee, the company will withhold the money for you.