Self-Employment, Life, and Taxes

When you have a job, you just get a check. Taxes come out, but until about February, most people with jobs don't need to think about taxes at all. When you don't have a job? Suddenly the tax thing is a huge scary monster.

When you work for yourself you're responsible for your own taxes. Sounds obvious, but it's trickier than I thought. Take home pay calculators for the traditionally employed are all over the internets. Calculators that can/ will do the math on self employment taxes are rather more difficult to find. To be safe I've been working with 35% overall tax rate- FICA, state, fed, whatever.

Turns out this is (more than a little) high. There's no way in any colored hell I'll make enough to pay that much. This year I'll be lucky if I make enough to pay federal income tax at all. Feels strange to write that, by the way--lucky to pay tax. A more accurate tax rate for me, random web site told me, is 22 to 28 percent, including state, fed, and FICA--if I make $4,000 a month for the rest of the year. Not bad.

Related to the whole tax thing, I have to figure out what my tax home is. I don't think you can be without a tax home, and I don't want to be taxed SC state income tax (7% of everything) while I'm off living in some random country. So I foresee some quality time spent between the IRS website, and their Q&A hotline.

Positive stuff this weekend included reading about someone who wandered past an ~300USD /month studio with all utilities included in the non-tourist part of Playa del Carmen. Ok, the *less* tourist part. With WiFi. That's $70 less a month than I pay now, and without a car my savings would be even better. Mexico and South America sound better every day. I'm dreaming about travelling and paying down my debts, all for about what it's costing me to eke out some miserable un-life here. Sounds good to me, even if it means travelling slower than slow.