What is the amount of self-employment tax that would be paid by Andy for the yea

Question

What is the amount of self-employment tax that would be paid by Andy for the year assuming he earned $104,600 while working as an employee of Car Company, $3,000 in interest, $2,500 in dividends and an additional $25,000 from a sales business he owns? What is the amount of self-employment tax that would be paid by Andy for the year assuming he earned $104,600 while working as an employee of Car Company, $3,000 in interest, $2,500 in dividends and an additional $25,000 from a sales business he owns?

Explanation / Answer

Particulars Amount in $ Amount subject to OASDI Self Eployment tax 127200 less: Amount subject to social security tax 104600 Amount subject to OASDI Self Eployment tax 22600 OASDI Self employment tax rate 12.40% OASDI Self employment tax 2802.4 Hi net earnings from self employment 20000 Hi self emplyment tax rate 2.90% Hi self emplyment tax 580 Total Self Employment tax (2802.40+580) 3382.4 ** Interest and Dividend incomes are not subject to Self employment tax

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