The IRS website states sole proprietors pay personal tax only (see chart at the bottom of the page), but it’s my understanding that they must pay both personal income tax and self-employment tax. Can you explain why ...
  1. Sole proprietors pay both personal income tax and self-employment tax (Medicare 2.9% and social security tax 12.4%) if there is business income. You must report ... Read more

As a small business owner, I read that I am able to start a self-employed 401k and contribute 19k plus 25% of last years income. Would I also be able to start an IRA and deduct contributions from a second ...
  1. Traditional or Roth IRA for small business owners has a contribution limit of up to $6,000 with an additional $1,000 for contributors who are 50 or older (catch ... Read more

My business partner and I started a small business back in October 2019. We are in the bronze foundry business specializing in fine art. Our jobs sometimes involve doing subcontract work with other bronze foundries as well. Which they ...
  1. Unfortunately, on paper you are operating as an individual in a partnership which makes you liable for income tax, self-employment tax and estimated taxes. W-9 ... Read more

I do a side work as a doordash delivery, sometimes I choose to travel to another city 40 miles away to work there and come back . Can I add these 80 miles back and forth to the standard milage ...
  1. Any time you are utilizing your personal vehicle for business purposes, those miles driven are business miles; however, commuting miles cannot be counted. As a ... Read more