How much to set aside for taxes when you work for yourself
Setting money aside for taxes means moving part of each payment into a separate account, so the cash is ready when a tax bill comes due. Most EasyTax customers move 25 to 30% of each payment to a tax account the day it lands. That range covers self-employment tax of 15.3% and federal income tax for many freelancers, and your state may add more.
Last April's tax bill was decided the day each client paid you. Most EasyTax customers move 25 to 30% of each payment to a tax account the day it lands. That range covers self-employment tax of 15.3% and, for many freelancers, federal income tax. Your state may add more. If you save on payment day, April brings no surprise, and you pay each quarter from money already set aside. What share of each payment do you set aside today?