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Old 05-30-2005, 10:13 PM
jmccaffrey jmccaffrey is offline
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Join Date: May 2005
Location: Poughkeepsie, NY
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Question Setting Up Taxes for Self Employed Consultant.

I have consulted in the past but have had an agency take out taxes and recorded my salary similar to that od a w-2 worker. However I would like information as to how the accounts should be set up to account for the what I must pay out as a Self-Employed Consultant. There seems to be much info regarding paying a consultant but not that much info on how to to set up quickbooks if I was the consultant..
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Old 05-31-2005, 07:57 AM
jfreitas jfreitas is offline
Join Date: May 2005
Location: Minnesota
Posts: 77
If you are a Sole-Proprietor, then create an Equity account called 'Estimated Tax Payments' as a sub-account of your draw.

It is not a business expense. It is an estimated payment toward your personal income taxes and self-employment tax. Self-Employment tax is the FICA and Medicare portion that is calculated and paid paid along with your income taxes (Sch SE) for self-employed individuals.

You should consult a Tax Professional to assist you with calculating the estimated amount to pay.
Janine Freitas
Certified QuickBooks ProAdvisor(SM)
Freitas Software Consulting
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Old 05-05-2006, 07:03 PM
Dabrowski Dabrowski is offline
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Join Date: May 2006
Location: Kansas
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What does sub-account of your draw mean? I don't know where there is a draw account in my list.

This is an old thread. Hope it's still active
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Old 05-06-2006, 03:53 AM
Joe Williams Joe Williams is offline
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Join Date: Jan 2006
Location: Oklahoma
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As a Sole-Proprietor you should have an account Owner's Equity with a sub-account Owner's Drad. The draws that you take should be posted to the Owner's Draw account. You then create a sub-account of it named 'Estimated Tax Payments' to track your "tax deductrions" and payments.
Joe Williams
Piedmont, Ok
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Old 05-06-2006, 11:50 AM
Joey Joey is offline
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Join Date: Jan 2002
Location: South Florida
Posts: 6,258
Just for the record, Joe is correct but it doesn't have to be in a SUB-ACCOUNT of the Owner's Draws equity account. You can charge the tax payment directly to the Owner's Draws account and then just print out that account at year end and locate those payments. They need to be included separately on your tax return in a different place from your business income and it's easier to locate them if they are in a sub account by thenselves.
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