It’s my first year as a 1099 worker. I’m still unclear on what my tax rate is, and how much I will owe in taxes this year. I just hope that I’ve saved enough.
It looks like my overall earnings this year will be $60k.
That puts me in the 25% federal tax bracket.
So I owe the feds $15,000.
Then state taxes are 9.3%
I owe the state $5580.
Self employment tax is 15.3%
I owe an additional $9180
Totaling $29,760 in taxes for 2008.
Then I have minimal “income” from dividends, interest and such, which I will owe tax on.
I assume that means I will owe $30,000 in taxes, or 50% of my income.
That seems rather high, am I doing my math wrong?