Help with Freelance Gig Tax Determination for UI
Hello! I'm currently on unemployment after a layoff. Recently, I got a short freelance gig of $800 that I need to report. I'm trying to determine the total amount I earned after taxes and deductions for my weekly certification.
I know about the [Net Profit * 92.35% * 15.3%] formula, which brought me to $113.04 in taxes. However, I've also seen other posts mention needing to calculate the AGI, as well as factoring in QBI deduction. This is where my head is spinning. I'm not sure if I need to include these steps or if I'm using the right numbers. Could really use the help!
This is what I'm using as guidance:
- Profit = Revenue - expenses
- SE Tax = Profit x 0.9235 x 15.3% (see Schedule SE for that 0.9235 multiplier)
- AGI = Total income - 1/2 SE tax (and any other adjustments)
- Taxable income = AGI - (standard or itemized deductions) - I stopped here at $743.48.
- QBI deduction: 20% of the lesser of:
- Taxable income above
- Profit - (1/2 SE tax, self-employed health insurance, self-employed retirement)
- New taxable = Taxable income above - QBI deduction
- Income tax = marginal tax rate(s) applied to "New taxable"
Additional info:
- Net: $800
- Sole proprietor (no LLC).
- Based in California.
- Married, file taxes jointly.
Thanks in advance!