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Primer: Personal Income Taxes (sole proprietorships, partnerships) Michigan

If you operate a sole proprietorship or partnership, you must pay city, state, and federal income tax just like anyone else and you are responsible for paying it directly to the government. Federal income taxes must be paid in estimated quarterly payments. These payments are due in four installments on: April 15, June 15, September 15, and January 15. These federal taxes will cover your self-employment tax which includes social security and Medicare. This self employment tax makes working for yourself expensive because when you had a boss, your employer paid for half your self-employment tax and you paid the other tax. You will now be responsible for all of it, although a portion of it is deductible.

Local Companies

Accurate Tax & Financial Planning Services, Co.
(248) 298-2966
1505 E Eleven Mile Rd.
Royal Oak, MI

Alexander Resource
(734) 665-6749
436 Spring St
Ann Arbor, MI

Childcare Network
(734) 243-7451
Monroe, MI

Emro Marketing
(517) 784-4177
3346 E Michigan Ave
Jackson, MI

Dehaan Associates
(616) 457-1079
1765 Broadview Dr
Hudsonville, MI

Moseley Laura R
(248) 483-5405
16500 N Park Dr
Southfield, MI

Nelson Ron L PA
(231) 924-0244
2 E Main St
Fremont, MI

Roc Group Mi the
(231) 722-4408
316 Morris Ave
Muskegon, MI

Marigold Productions Llc
(231) 941-7700
1201 Anderson Rd
Traverse City, MI

Center For Simplified Strategic Planning Inc
(734) 665-2971
2219 Packard St
Ann Arbor, MI

If your state has an income tax, you must pay it quarterly also. Cities may have their own tax rules.

Generally speaking, you must pay estimated quarterly installments if you expect to owe at least $500 in tax for a given year. The laws governing how much tax you must submit during the year require that you either pay 90 percent of the tax you will owe by the end of the year (to avoid penalties), or pay 100 percent of last year's tax (110% if your income exceeds $150K). This means that you can submit a minimum amount of tax during the year if you want to hold on to some of your money. However, this plan only works if you are able to leave the money intended for taxes alone. Too many people spend the money that they put aside then run into trouble at tax time. If you fail to make your payments on schedule and within these guidelines, you will be liable for penalties -- plus interest on the money you owe.

Your tax preparer should provide you with forms and envelopes for making your estimated payments, or you can order these forms directly from the IRS by calling 800-829-3676.

Featured Local Company

Accurate Tax & Financial Planning Services, Co.

(248) 298-2966
1505 E Eleven Mile Rd.
Royal Oak, MI

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Business Services	Fashion	Industrial Goods & Services	Retail & Consumer Services
Career	Financial Services	Insurance	Software
Cars	Food & Beverage	Internet	Technology
Computer Hardware	Franchise	Legal	Telecommunications
Construction	Health	Miscellaneous	Trade Shows
Education	Holidays	Nightlife	Travel
Entertainment	Home Appliances	Online Database	Weddings
Environmental	Home Electronics	Pets	World History