I became self employed after an injury this February, and started making enough $$$ to cover my expenses as an Independent Contractor. In November, my self-employment REALLY started earning me quite a lot of dough. I found a niche ONLINE … and I successfully pursue most opportunities – earning quite a bit more than what’s necessary to cover my expenses. I’d like to know what the minimum amount of money earned is for a single Head of Household. I have heard a few different amounts … but would like to put this question out to G.P. (general public) via Yahoo Answers …
Categorized | Affiliate Marketing 101
What Is The Lowest Amount That A Single H.of H. Can Earn Without Having To File Taxes?
Posted on November 30, 2010.
For those who are self employed, the minimum is $400.
Head of household will reduce income tax further than what a single person would pay. But self employment tax (basically FICA for the self employed) doesn’t care about head of household.
Any business operation is required to file the schedule C or C-EZ and SE of the 1040 federal income tax return reporting all GROSS income less the ordinary and necessary business expenses to determine the NET PROFIT amount correctly and completely and when the net profit is more than 400 the 15.3% of social security and medicare taxes will be calculated and due on all of the NET PROFIT amount plus any income tax that may be due when the NET PROFIT is added to the other TAXABLE income when the 1040 federal income tax return is correctly completed and ready to sign and send to the correct IRS address.
The self employed taxpayer should always have the receipt book available to issue a receipt for the amounts of each payment that is received from the taxpayers that the SE taxpayer independent contractor is performing the services for and when the payments are made to the SE taxpayer and keep the copies of all of them for use as needed to prove that all of the gross income for the tax year is correct when preparing the correctly completed 1040 federal income tax return after the end of the tax year.
You really do need to have some very good records of all of your business operation income and expenses available to you when you complete your schedule C and SE of the 1040 federal income tax return completely and correctly after the end of your tax year and the tax return is being sent to the correct IRS address.
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)
Hope that you find the above enclosed information useful for your situation and good luck to you.
If you are self-employed, the minimum to file (and pay) is $400 for the entire year.
Regardless of your filing status, if you are self-employed you are required to file taxes when your earnings from self-employment are $400 or more. This is not because you owe income tax, it is because you will owe Social Security and Medicare taxes which you will pay on you federal income tax return.
As Head of Household with one dependent, you will not owe income tax when your income is less than $15,700, or even more if you qualify for credits. But, you will owe self-employment tax of approximately 15% of your self-employment income after expenses.
If you’re self employed, you have to file if you made over $400 for the year, no matter what your filing status is.
Congrats on your success getting your business going!