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fawningandconning t1_j2flmo3 wrote

Reply to comment by BakedPastaParty in Getting paid in this way for the first time. Had to fill out a W-9. What are the tax implications for me now? by BakedPastaParty

You got bad advice then, if you're paid via W2 (aka, you receive a paystub which shows money withheld for federal/state taxes/social security/etc.) then your employer was wrong. You being hired hour to hour has nothing to do with it, all that matters is what you filled out initially and the way in which you're paid.

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BakedPastaParty OP t1_j2flzay wrote

Alright I will need to look into this to be sure what my situation is. That notwithstanding, the contractual payment I have going on is more my concern. So far, Ive gathered I am going to have to pay an overall percentage on that income as there aren't any witholdings at all.

e: I just want to know what kind of percentages to expect/ to try and use to project what I will owe/ etc. Ive got an informative answer, but I would love as much informative input as possible.

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fawningandconning t1_j2fm2vd wrote

Yes correct. You should expect to withhold at least about ~14% of your earnings from the contract job and pay that quarterly to the IRS.

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MarcableFluke t1_j2frux5 wrote

You will pay roughly 15% of your net earnings (income minus ordinary and necessary business expenses) towards self employment taxes.

You will be taxed federally on the net earnings as well. How much will depend on how much you make both from the contract position and other sources of income. We have a progressive tax system and all income is pooled together before a final tax liability is calculated.

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