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Do independent contractors qualify for tax deductions?

The Tax Cuts and Jobs Act also created another deduction that some independent contractors may qualify for: the qualified business income deduction. This may allow you to deduct up to 20% of your business income. Back to top Self-employment taxes A big financial drawback of self-employment is paying self-employment taxes.

What is the combined tax rate for independent contractors?

The combined tax rate is 15.3%. Normally, the 15.3% rate is split half-and-half between employers and employees. But since independent contractors and sole proprietors don’t have separate employers, they’re on the hook for the full amount.

How do I pay business taxes as an independent contractor?

Paying business taxes as an independent contractor can be tricky. You have to file additional forms, make sure you’re paying the government enough during the year and pay a self-employment tax. FEATURED

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