Easy Ways to Calculate your 1099-MISC Income Forms
One of the things that you cannot deny with life's that there are taxes. There's simply no way you could avoid it. If you are ever self-employed, it is essential that you make sure that your credit responsibilities are all in check. Because you are a 1099-MISC income earner, it's a requirement to show proof of income for our taxation laws, insurance purposes as well as for loans. If you are ever a freelancer, the taxes that you will pay will go towards the Social Security and Medicare. If you are wondering what is the 1099-MISC form that you have acquired, below are some of the things that you need to know about it.
Any self-employed individuals or known in some other terms as the 1099-MISC income earners needs to pay their tax at each quarter to the IRS. For every January, you will be receiving a 1099-MISC form in your mail from each company which you have worked in the previous year. If in case you have worked for more than one firm in a single year, the number of forms that you will get is equal to the company you have worked with in that year. Read more on how to Calculate 1099-MISC Taxes.
For every form, you will be able to see a certain amount on it on Box 7, which would be the overall amount that have been remunerated by the employer, which means that you need to pay tax on the amount that was specified. You should bear in mind that it is all your responsibility of being able to stay on top of your credit responsibilities if ever you fail your income bracket.
When it comes to filling out your form, the company which you have worked for throughout the year will handle the total process of your earnings on each of the form you have. This in fact is the reason as to why it is very important that you also collect and track your earnings.
How to Calculate your Tax in a 1099-MISC Income
1 Step
Total your income amounts on each 1099-MISC Taxes and when you have more than one form, consider combining the overall income from all of the forms.
2nd Step
Total your business expenditures that you have tracked and then subtract this from your total income and it will bring you to your net income.
3rd Procedure
Multiply the net income amount by 0.9235 so you are able to calculate the taxable income.
4th Process
Consider checking the IRS tax table on the amount of tax that you owe on your taxable income. Take note that the tax schedules will vary from every state.
Now, you could submit your 1099 MISC form electronically and the payment should be made by 8pm before January 31st. Look for more facts about taxes at http://www.dictionary.com/browse/taxes.