Entries Tagged 'Self-employment' ↓

A No-Cost Tax Break for Self-Employed

A reader of a recent post asked, Nancy, I understand that a self-employed person has to shoulder the expenses that an ordinary wage or salaried person does not. But if those expenses are legitimate, and a self-employed person doesn’t earn enough to pay SE tax, how can that person even make a living to survive? If they aren’t making enough revenue to cover their costs of operating their business, how can they afford to cover their personal expenses to survive?

This is the key question I’ll discuss today. It’s why I believe some self-employed workers need a break on paying SE tax. Continue reading →

Why Care About The Self-Employed?

If you’ve been reading my posts about the self-employed on Huffington Post, you may wonder why you should care about tax reform for the self-employed. Why care if self-employed make less money than employed yet pay higher tax rates? So what if lower-income self-employed get taxed twice on the higher amount they have to pay for SE (Social Security/Medicare) tax?

How many self-employed people are there in America anyway?

The US Census Department, 2009 Current Population Survey counted more than fifteen million. That’s well over ten percent of the US workforce, and it’s one-third greater than the current 7.7 unemployment rate that has everyone so worried. Fifteen million is three times the total membership of the powerful lobbying group, the NRA (National Rifle Association).

So, why isn’t the government concerned about self-employed Americans? And why should you care?

Because self-employment is the foundation for small businesses, and right now small businesses, not large corporations, are the chief driver of innovation and new job creation in the US economy. Continue reading →

IRS Denies Self-Employed Profits

Self-employed business owners desperately need tax reform. But no meaningful tax reform for self-employed will take place until the IRS dumps its Chimera of self-employed being “two persons in one”. The IRS taxes self-employed as if they are both an “employer and an employee”, i.e., as if they are two persons in one body.

That’s ridiculous! The self-employed person is neither an employer nor an employee. He or she is a unique hybrid – a self-employed worker without a boss.

Worse yet, the IRS uses its two-person-in-one myth for its own benefit while self-employed people get the shaft. Let’s look at two examples: Continue reading →