How Do You Calculate Health Insurance Taxation For The Self Employed?
Employees of most businesses, non-profits, and government agencies have half of the total taxes for Social Security and health insurance (Medicare) paid by their employer. If you are self employed you are responsible for the entire amount, you’ll need to know how to calculate health insurance taxation for the self employed. Be sure not to confuse Medicare with Social Security. For convenience, the two are often lumped together in a single calculation. However, they must be calculated separately if your net earnings exceed the cap for Social Security contributions ($106,800 as of 2009). Figure out your net profit using Schedule C. This is your total revenues minus all deductible business expenses. Alternatively, you can get your net profit from Form 1040, line 12. Calculate your net earnings using Form 1040, Schedule SE. Multiply the net profit by 0.9235. This is called your net earnings and is the figure used to calculate health insurance taxation for the self employed. Check the amoun
