First State CPAs and Associates

19 hours ago

𝙒𝙝𝙮 𝙙𝙤𝙚𝙨 𝙢𝙮 𝙩𝙖𝙭 𝙗𝙞𝙡𝙡 𝙛𝙚𝙚𝙡 𝙨𝙤 𝙢𝙪𝙘𝙝 𝙝𝙞𝙜𝙝𝙚𝙧 𝙣𝙤𝙬 𝙩𝙝𝙖𝙩 𝙄’𝙢 𝙨𝙚𝙡𝙛-𝙚𝙢𝙥𝙡𝙤𝙮𝙚𝙙?

Because you’re paying both sides of Social Security and Medicare now.

At a W-2 job, you pay 7.65%, and your employer matches it.

When you’re self-employed, you pay the full 15.3%.

On top of that, you’re also responsible for:
• Paying tax on your profit, not revenue
• Making quarterly tax payments
• Tracking your income and expenses yourself

You can typically deduct half of your self-employment tax, which helps lower your taxable income.

But no one is withholding taxes for you anymore.

That’s the shift that catches people off guard.

A practical next step: estimate your monthly tax set-aside based on your last few months of income, then automate that transfer before the money gets absorbed into everything else. ... See MoreSee Less

First State CPAs and Associates

2 days ago

"Remember, diamonds are only lumps of coal that stuck to their jobs." -B.C. Forbes

Whether you're trying to stick to a budget, a business plan, a parenting strategy, or an exercise plan, envision the end result and keep at it. ... See MoreSee Less

First State CPAs and Associates

5 days ago

𝗪𝗵𝘆 𝗶𝘀 𝗴𝗲𝘁𝘁𝗶𝗻𝗴 𝗮 𝗯𝗶𝗴 𝘁𝗮𝘅 𝗿𝗲𝗳𝘂𝗻𝗱 𝗯𝗮𝗱?

Because it means you gave the government too much of your paycheck all year.

We get it. A refund feels good when it hits your account.

But that money was yours the whole time! So, with a few adjustments, you could make that money work for you now.

1. 𝗬𝗼𝘂𝗿 𝘄𝗶𝘁𝗵𝗵𝗼𝗹𝗱𝗶𝗻𝗴
This is the amount your employer takes out of each paycheck for taxes. If too much is coming out, updating your W-4 can help bring that number closer to what you actually owe.

2. 𝗬𝗼𝘂𝗿 𝘀𝗶𝗱𝗲 𝗶𝗻𝗰𝗼𝗺𝗲
If you freelance, drive for an app, sell online, or earn income outside your W-2 job, it’s better to plan for those taxes during the year instead of being surprised later.

3. 𝗬𝗼𝘂𝗿 𝗲𝘅𝘁𝗿𝗮 𝗰𝗮𝘀𝗵
Money sitting with the IRS all year could have been in a savings account, retirement account, HSA, or another place where it had a chance to work for you.

True or false: I’d rather get a smaller refund if it meant keeping more money in my paycheck each month. ... See MoreSee Less