As an independent contractor, what percentage of my gross income do I have to pay?

It will not be the gross income but the NET PROFIT from you business operation that all of the taxes will be due on when your 1040 federal income tax return is completed correctly.

If you are a self employed taxpayer then you are responsible for all of your own FICA self employment taxes of 15.3% plus any income taxes on your net profit from your business operation at your marginal tax rate.

You will need to report that income, and any related expenses, on Form 1040, Schedule C, Profit or Loss from Business, or you may qualify to use Form 1040, Schedule C-EZ, TO determine your Net Profit from Business. You will also need to use Form 1040, Schedule SE, Self-Employment Tax to compute and report your social security and Medicare tax.

For instructions and forms go to the IRS.gov website and use the search box for publication 334 a very good place to start with examples.

Publication 463 Travel, Entertainment, Gift, and Car Expenses

Use the search box at the IRS.gov website for Small Business and Self-Employed Tax Center

Filing Season Central is your one stop assistance center for filing your business returns. This includes Highlights of Tax Law Changes, Tax Tips, and more.

2 of the seven tax tips for starting a business enclosed below.

#4 Good records will help you ensure successful operation of your new business. You may choose any record keeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.

#7 Visit the Business section of the IRS gov website for resources to assist entrepreneurs with starting and operating a new business. Go to the IRS gov website and use the search box for the below referenced material

*Starting A Business

*Operating A Business

*Closing A Business

*Publication 4591, Small Business Federal Tax Responsibilities (PDF 470.1K)

http://www.irs.gov/

http://www.irs.gov/publications/p334/index.html

http://www.irs.gov/businesses/small/index.html

You can find the estimated tax worksheet and instructions by using the below enclosed information

If you would like to do some estimated tax calculations you would need to go to www.irs.gov and use the search box for 1040ES go to page 8 for the 2010 Tax Rate Schedules and page 7 for the worksheet.

http://www.irs.gov/pub/irs-pdf/f1040es.pdf

You can try anyone of the online estimated tax calculators for some estimates to get an idea of what things may look like after using the correct IRS forms and compare the numbers.

Use your search engine and type ESTIMATED TAX CALCULATORS and you will be able to find several of them that you can use for this purpose.

http://www.dinkytown.net/java/Tax1040.html

There is no simple percentage rate, not even for an estimate. The percentage for someone making $80,000 is more than twice the percentage for someone making $600.

You must pay both

1) a self-employment tax, which is fixed at 15.3% of your net (not gross) income from work as an independent contractor, and

2) an income tax, which can be anywhere from 0% to over 30%, of your total taxable income from all sources

No way simple way to say. Income taxes are based upon your NET self-employment income, not the gross. You'll pay 14.16% in self-employment tax on the net up to the Social Security cap and 2.6% thereafter, plus income taxes that will depend upon your income, filing status, number of dependents, deductions, etc.

Estimate your net income using your business plan and carry those numbers to the worksheets on Form 1040-ES http://www.irs.gov/pub/irs-pdf/f1040es.pdf to arrive at a meaningful estimate for yourself. Don't forget state income taxes as well; your state will have a similar package that you can use to estimate your state taxes.

Around 14% for self employment tax. Can't give you an answer on income tax without a lot more info about your personal situation, how much you make, and where you live.

you determine your self employment income on Sch C and whatever that amount is

you transfer to Sch SE

then you multiply that amount by .9235 when you get that answer, you then multiply by .153 which is your self employment tax

this is due and payable regardless of anything else you might owe

I pay about 21% to taxes, Federal, State, and Local

is anyone able to tell what is the right answer for this question?