Archive for the ‘Self Employment Tax’ Category
ELIMINATION OF SELF
EMPLOYMENT TAXES (SE)
HISTORY AND BACKGROUND
Self-Employment Tax (SE) is in addition to the self-employed individual’s income tax. Currently the SE tax consists of the combination two (2) taxes: 1. Social Security of approx. 12.6% and 2. Medicare of approx. 2.9%, totaling 15.3%.
For the year 2007, the SE tax applies to net earnings of up to $106,800.00, thus $16,340.00. This is already a significant burden on the self-employed, however the worst may be yet to strike.
Congress, faced with a significant shortfall of revenue, should the split social security retirement plan be adopted for younger workers, is considering raising the taxable SE income level to $200,000.00, thus a SE tax of $30,600.00.
