When it comes to dealing with taxes, just the word, “taxes” gets people to cringe and withdraw from conversation. There are three types of these taxes and they are federal, state and local taxes. The amount you owe these government bodies depends on how much you total income you have received at the end of the year.
The progressive tax system does a pretty decent job according to some about keeping things fair and even, but others would say it could do better. The tax system goes off how much money you make and taxes you more or less respectably. The more money you earn, the higher your tax rate. Your marital status also plans a big part in this.
Taxes become even more complicated If you’re self employed or own a small business owner because you are required, and expected for the most part, to handle everything on your own. Sounds like a nightmare! This means you’ll have to crunch your numbers in an effort to understand how much money you’ll need to save up in order to cover self employment taxes.