What Is The Self Employment (physical labor jobs) Tax?

October 27th, 2008 admin Posted in employment |

By Ben Needles

So who exactly is subject to the IRS self employment tax? Sole proprietors, partners in a small business and independent contractors are the most common examples of people subject to the self employment tax. But just because you make a couple of dollars selling some stuff on an auction website doesnt mean youll have to pay taxes on it. You need to have earned $400.00 or more during the tax year before you have to pay taxes on the money.

To help explain what the self employment tax is you need to understand what taxes are paid on your behalf when you work for someone else. The taxes that would normally be taken out of your check by your employer include both the federal withholding tax and FICA. The tax were concerned with here is the FICA tax. Normally this tax is 7.65% of your gross income. The tax is actually two separate taxes. One is your Social Security tax with a tax rate of 6.2%. The other goes to Medicare and the tax rate for it is 1.45%. Combined you have your 7.65% tax rate.

Now the federal withholding and FICA taxes are normally withheld by your employer and sent to the IRS. But the actual rate paid to the IRS for the FICA tax is not 7.65%. That is just the portion that is withheld from your paycheck. The actual FICA rate that is paid is 15.3%. The 7.65% you pay on your gross wages has to be matched by your employer and is then applied to your account. So if you had $100.00 withheld for the FICA tax by your employer then they have to match that money with an additional $100.00. If you are the employer this can eventually become a very large amount of money that you will be responsible for paying.

So if you are considered self employed the self employment tax you are paying is the matching portion of your FICA taxes. Since the taxes must be paid and you are considered your own employer you are responsible for paying the tax yourself. The government will always want its money regardless of where they get it.

If you are an entrepreneur and own a small business then there is no real way of getting around this tax. Even if you file W-2s for yourself and your employees you will still pay this tax on yourself. It will just change from being a self employment tax back to a matching FICA tax. Either way it will come out of your pocket. Its just one small price you will have to pay to be your own boss.

About the Author (text)

Cash Miller is an experienced entrepreneur and speaker who has spent over a decade as a small business owner. His years of experience in small business cover many topics. For more small business information you can go to http://www.SmallBusinessDelivered.com

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Employment Law and the Road to Settlement
By Art Gib

What is employment law? Well, it is a very big area of laws that determine what the employer/employee relationship should be, and what is not allowed. It does not include negotiation though, which is covered under labor law and collective bargaining. Most employment laws state not only minimum wage, but also the definition of discrimination.

You see a lot of lawyers out there who fight for your rights if you feel you were let go in an unfair way or for what you feel are discriminatory reasons. For example, you cannot be let go if you are a different color, a women in a mostly man’s field, or if you suffer from mental disorders. As long as you can complete you job in a competent manor, you should be able to keep that job forever, unless they have downsizing, or you do something that does make it possible for a reasonable employer to fire you.

If you feel you have been let go by an employer and the employment laws have been broken you should call the EEOC, which stands for Equal Employment Opportunity Commission. They will send you paper work that you need to feel out stating why you feel you have been discriminated against; you then will mail this form back.

The EEOC will then have one of their field workers look at the form and determine, through their experience and the laws that are set up, whether they think you have a case or not. If they decide they will send you a form stating that they feel you have a case, you will need to sign it and return it to them in a timely fashion. After this step they will send the charges to the company that you used to work for. That company would then have up to 30 days to answer the charge, or ask for an extension.

This is where the process becomes extremely slow and you begin to wonder if your case will ever be settled. It’s not a quick process and the EEOC does tell you if you want to pay for a lawyer you can use them to go further on the case. But if you have the patience to wait for all their paperwork and the bureaucracy that is the government, it might be best to do it this way.

Hopefully within six months they say that you should know what has happened with your case if a settlement was reached or if it was dropped. Of course, if they drop the case you do have the option to go to an attorney then too.

Either way, a Houston employment attorney can strengthen your case and make settlement into a reality. For more information on the services of employment lawyers, their qualifications, and their fees, visit http://www.rosenberglaw.com. The author, Art Gib, is a freelance writer.

San Diego Wrongful Termination Lawyers
By Joe Mueller

Getting legal counsel from a San Diego wrongful termination lawyer is important for those who feel as though they have been terminated wrongfully by their employer. The attorneys will certainly help you better understand your legal right when it comes to the murky waters of employment law, especially employment law in California.

California is a state that has what are called “at-will” employment laws. What this means for those who are employed in California (and San Diego by extension) is that you can leave your employer for any reason or condition at any time. If you feel like you could get a better job elsewhere, you are free to leave. If you don’t like your coworkers, you are free leave. If you don’t like your bosses hair, you are free leave. In fact, you can leave at anytime for any reason under California law.

This benefits you as an employee because it give you the freedom to move when greater opportunity arises or circumstances at your current job require it. You are able to do as you want.

In the same way that you are free to change jobs for any reason, so too is your employer free to end your employment for any reason. If they don’t like your work ethic, they are free to fire you. If they don’t like the sound of your voice, they are free to fire you. If they don’t like the way you type memos, they are free to fire. While some of these reasons may seem unfair to us, these are perfectly legal reasons for an employer to terminate any one of their employees. They simply are not grounds for a wrongful termination case in San Diego.

Any San Diego wrongful termination lawyer will be able to tell you this. The issue will never be whether your termination was “fair” or not. What matters is whether or not your termination violated either a state or federal law which expressly prohibits your termination for those conditions. This can be difficult to prove in some cases, so be sure to consult a lawyer before making any accusations at work or on the internet.

Some of the more common reasons to take up a wrongful termination case would be the following:

You might be the subject of a wrongful termination if it was an instance of retaliatory firing. If you have recently taken part in some sort of employee action against the company for which you were fired you could have a case against your employer. Be sure to talk with an experienced employment attorney to make sure that you have a case.

Another reason that individuals suffer termination would be for reasons associated with a pregnancy or pregnancy leave. It is illegal for your employer to fire you for these reasons so be sure that you check with an attorney.

Those are just a few of the many reasons that you might have a wrongful termination case in San Diego. A San Diego wrongful termination lawyer will be the most qualified to tell if you your specific case has merit, so be sure to take advantage of many wrongful termination firms’ free consultation policy.

Finding a wrongful termination lawyer can make all the difference in your case employment law case. Need help with finding the right one? Check out our San Diego Wrongful Termination Firms article for more info on this important topic.

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