What You MUST Know About Self Employment Tax

Self employment tax is actually a lot simpler than you think. Instead of working through confusing tax brackets, self employed tax is just a flat rate on all of your income. Here's exactly how self employment tax works.

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As an employee, your employer is automatically withholding your payroll taxes on each paycheck and sending them off to the IRS. This is why they are referred to as Payroll taxes, because they are accounted for when your employer runs payroll.

However, as a creator or otherwise self-employed person, you don’t have an employer withholding taxes for you. You are just receiving checks from YouTube, sponsors, and affiliates straight into your bank account. This makes you feel like you have a lot more money than you actually do because you’re going to owe both income taxes and self-employment taxes on that money.

Additionally, as an employee, you get to split these taxes with your employer. As a self-employed person, you are both the employee and employer and so you’ll be paying both halves of this tax. This essentially means you’re paying twice as much in self-employment taxes as you would be paying in payroll taxes.

Because of this, it’s typically going to be a good idea to open up a separate bank account solely to hold your tax money. This helps your brain distinguish between your money and the government’s money. Personally, I keep my tax account with a completely separate bank so I can’t even see that money until I log on to that account to pay my taxes.

QUARTERLY TAXES: https://youtu.be/mrx1YMfSfcc
INCOME TAXES: https://youtu.be/-3nT2PytWH0
TOP TAX DEDUCTIONS: https://youtu.be/t60fe3usPso
YOUTUBE TAXES: https://youtu.be/RZ2MeT2HIG4
TIKTOK TAXES: https://youtu.be/xUY0xjdsxe8

TIMESTAMPS
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0:00 - Intro
0:31 - What Are Self-Employment Taxes?
1:01 - How Do Self-Employment Taxes Work?
5:36 - Social Security Taxes
7:40 - Medicare Taxes
9:10 - Self-Employment Tax Example
11:37 - The Self-Employment Tax Deduction
13:15 - When Are Self-Employment Taxes Due?
16:36 - How Do You Pay Self-Employment Taxes?
18:27 - Final Thoughts
19:39 - Outro

Видео What You MUST Know About Self Employment Tax канала Apple Crider