Tag Archives: withholding income

Tips for self-employed taxpayers

Tips for self-employed taxpayers

Small business is the backbone of America many say. Whether you operate a small landscaping business or a professional services firm there are several common issues and concerns about accounting and taxes. Self employed individuals also have different options for investing for the future.

Every April self-employed taxpayers calculate income, expenses and deductions to keep as much of what they earned as they can. For people who follow the recommended quarterly estimated tax payment plan, the final tax preparation should be stress free because they paid into the system all year long and might get money back. For many other self-employed individuals, filing taxes every April means you have a large tax bill and owe thousands of dollars or more to the IRS.

While you can work with the IRS on payment plans and solutions to manage your IRS debt and payments, the experience of not having the money set aside to pay income tax may be something you want to prevent in the future.

Estimating, saving and paying income taxes

Based on your recent accounting and tax returns, you should be able to anticipate how much of your income needs to be sheltered and used to pay income taxes.

When you receive a paycheck and your taxes are withheld by your employer you do not really feel that money coming out of your check as you get used to the idea that the net amount is what you have left to spend. The challenge to self-employed business owners is to have the discipline to set estimate and set aside money to pay quarterly tax payments.

There are apps you can use to automatically set aside money for taxes. Your bank or credit union may also offer an income tax collection solution where a percentage or fixed amount of every deposit is automatically separated into another account the owner cannot access until it is time to use that money to pay taxes.

Saving self-employed income for the future

What are your options to save for retirement when you are self-employed, and nobody is offering you a 401(k) plan or pension? If you pay attention to advertisements in print and media, there are several advertisements for investing for the future when you are self-employed.

Consider a collection of information offered by CNN Money, the Ultimate guide to retirement for self employed individuals. Another key to saving for the future is budgeting to have money automatically withheld from your regular income that you don’t miss while that money works for you to either pay your taxes or invest in your future and retirement.

Chicago bankruptcy lawyer, Joseph Wrobel wants people to take control over their financial future. No matter what your financial past, you can always change direction and enjoy financial success. If getting rid of old debt that drags you down is making that much harder to get ahead and you need a fresh start call Joseph Wrobel, Ltd. to learn about your Chicago bankruptcy options by dialing (312) 781-0996 or Contact one of our locations through the website.

Bankruptcy Court: go ahead and make their day

The last thing you want to do when asking for bankruptcy protection is lie to the judge! A woman in upstate New York learned her lesson the hard way when a federal judge recently threw the book at her for failing to disclose that she could afford payments on her leased Mercedes. The 33 year-old was sentenced to two years of probation and 50 hours of community service. Luckily, for her, she pled guilty to defrauding the court, because had prosecutors needed to spend efforts further prosecuting the case she may have ended up behind bars.[i]

One of the comments to the article: “Simple mistake. I countless friends of mine have done the same thing.” Not Yet Hacked Bluesman (response to his comment: “Nice ‘friends’ you have!” seniorplus)

So, you think…”probation isn’t that big of a deal…I’ll risk fibbing…” Here are some of the results you might earn if you fail to list assets and the trustee and the court find out (as noted in a recent Nolo legal resource article[ii]).

  1. The court will disallow your discharge of debts. Do not pass go, do not collect $200 because you’re done and just wasted your time and money.
  2. Your bankruptcy case may still be active but you may not receive discharge protection but may have to sell or turn over assets while keeping debts.
  3. The trustee could revoke your discharge, and you will need to go back into repayment of your debts. This may happen at any time before or after your case is closed by the court.
  4. In subsequent bankruptcies you might not be able to discharge the debts involved during the bankruptcy proceedings in which you were not truthful.
  5. Criminal charges could be fined against you. As in the case of the “hidden Mercedes” payments, you could end up with a criminal conviction and sentencing. No fun.

If you want to learn more about bankruptcy proceedings, contact an attorney at Joseph Wrobel, Ltd. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start. To keep in touch and read about consumer finance news and stories you can Like the firm’s Facebook page and Follow Joseph Wrobel. Ltd. on Twitter. If you need legal assistance please call Joseph Wrobel, Ltd. by dialing (312) 781-0996 to talk to an attorney.

[i] Syracuse News: Woman sentenced for not revealing money for Mercedes to bankruptcy court

[ii] Hiding Assets in Bankruptcy: It’s never a good idea to hide assets in bankruptcy. Here’s wny.