Self-employment tax or the SE tax is a Medicare and social security tax that is primarily for those individuals who are working for themselves. It is just similar with the Medicare and social security taxes withheld from wage earners’ payment.
Even if you are your own boss and you have no care about long commutes and office politics, you are still not free from paying taxes. This self-employment tax is being paid by those who earn at least $400 in the net profit as a sole-proprietor or independent contractor or as partner in a certain partnership. If your business is not yet incorporated, your net business income will still be subjected to a self-employment tax. You are also required to pay these self-employment taxes with your self-employment income even if you are already retired and are already receiving benefits from Social Security.
The self-employment tax rate is 15.3%, with 12.4% of it for the Social Security system and the remaining 2.9% is for the Medicare. But being a self-employed individual means that you have both the burden of being the employee and employer.
In calculating the self-employment tax, you will use the Schedule C or C-EZ in figuring the net earnings. The Schedule SE is the one used in computing and reporting self-employment taxes.
But when are self-employment taxes due? Usually, the filing of estimated tax is due in the 15th of the months of April, June, September and January, with the exception when it falls on a holiday or weekend.
These taxes are considered as the life line of any government. If people know how to pay their taxes responsibly, you can also expect that the services of the government will also be of the top quality. Always be sure that you know when self employment taxes due are so that you can help in the improvement of the economy of your state or country.