How do I calculate self employment taxes. For example Bob Dylan's self employment earnings are $50,600, what would be his 2021 total self-employment taxes?

PAYROLL ACCT.,2019 ED.(LL)-TEXT
19th Edition
ISBN:9781337619783
Author:BIEG
Publisher:BIEG
Chapter3: Social Security Taxes
Section: Chapter Questions
Problem 9QR
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How do I calculate self employment taxes. For example Bob Dylan's self employment earnings are $50,600, what would be his 2021 total self-employment taxes?

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Step 1

15.3% is the self-employment tax rate. There are two components to the rate: 2.9% for Medicare and 12.4% for Social Security.

For the year 2021, the first $142,800 of your combined wages, net earnings, and tips are subject to any combination of the Social Security part of self-employment tax. All your combined wages, net earnings, and tips in the year are subject to any combination of the 2.9% Medicare part of the Self-Employment tax.

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