A lot of people are trying to find ways to make moneyfrom home so that they can make ends meet. The poor economy has made it necessary to explore all your options. The Web is on every one’s thoughts as one of the simplest ways to accomplish that and it is undoubtedly the most effective way. An important question is though, have you ever ever thought-about what it might imply for your tax situation if you do become successful in generating a significant side income?
Most people who start out to make some additional money online only make small quantities by maybe going to one of many online surveys for money websites. They make $20 to $50 or much less and then call it a day because it is tedious and boring. But what if you are one of the rare people who doesn’t quit and goes on to make a lot more money online?
If you were to make make money in the thousands of dollars range, the first thing you should know is that you might owe Social Security tax. If you’re working for a corporation, they pay one half of the SS tax but when you are self employed, you will owe all 15.3% which is double what you’re paying now at your real job. This is the one big tax consequence that may people overlook when they are starting a home business.
There could also be other taxes, like state taxes, that you owe depending the place you live. Washington and Ohio have a B&O tax which will relieve you of another 1.5% of your gross proceeds. It doesn’t seem fair, but it is the law.
In the end, working from your own home is a great idea that many people would love to be able to accomplish. Nonetheless, few of them think about all of the little obstacles that will will happen when you are a sole proprietorship and work for yourself. It’s just like most things in life: there are good aspects and bad aspects to most everything you try.A Home Business Can Mean More In Taxes by Steve