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How much to save for taxes?

NooraK

Legend Member
Gold Member
Feb 6, 2008
5,871
26
I plan to make a profit on my business this year. Yes, I really do. I'm being very diligent about what I spend, not offering too many freebies and trying to boost my show schedule.

This of course means that I anticipate actually having to pay taxes on a portion of what I make. I want to set aside a percentage of my commission each month so that I'll be prepared.

But how much should it be? 15%? 20%? 30%?
 

esavvymom

Legend Member
Staff member
Sep 8, 2008
7,895
146
If it were me, I'd probably do the 20% range. You'll likely have extra- if it's anything like when we do our taxes....but we almost always get a big refund. Factor in your deductions from the biz.... And if you have extra- then you already have NC money set aside. You can adjust the amount the 2nd year if you saved too much.

That's how I'd probably do it- if I were making enough to plan like that ;)
 

wmrmgr

Novice Member
Nov 15, 2009
29
0
When I was self-employed in the past I was advised to set aside 30% and that would cover everything and then some (easier said than done when you live paycheck to paycheck). That's my two cents anyway!
 

ChefCat

Member
Jan 29, 2010
197
0
30% is what I would need to do here in Michigan.

I think it breaks down to roughly these percentages: 5% MI state, 10% Federal, 15% Social Security. Again, those are just rough percents from what I can remember.
 

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