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Although the premium users would benefit our service to the fullest but free users can also enjoy the high upload and download speed, the big storage capacity, and the powerful performance of our service. Employees pay similar taxes through employer withholding , and employers must make additional tax contributions on behalf of each employee.

The self-employed are required to pay all of these taxes themselves. The return must include a Schedule SE, which you use to calculate how much self-employment tax you owe. However, when you are filling out your , the IRS allows you to deduct a portion of the self-employment tax payments you make as an adjustment to income. The precise amount depends on how much self-employment income you earn. If you create a corporation or a limited liability company, making an S Corp election with the IRS might present some opportunities to reduce your self-employment tax liability.

With an S Corp, you generally pay yourself a reasonable salary out of earnings. You can distribute any remaining profits to yourself and any other shareholders or partners or leave the money in the business. In certain situations, the money in excess of your salary is subject to income tax but not employment taxes. However, under the appropriate circumstances with an S Corp, the amount that exceeds the reasonable salary you make is not subject to self-employment taxes.

Schedule C calculates your net profit from self-employment. You must include this as income on your and use it on Schedule SE to calculate your self-employment tax. Your net profit is equal to the gross receipts you earned minus your deductible business expenses. The lower your net profit number is, the lower your self-employment tax bill will be.

Therefore, to reduce your self-employment tax, you should be extremely thorough when preparing your Schedule C to ensure you deduct every possible business expense. Your business expenses need to be ordinary and necessary to operate your business to be deductible.

They cannot be personal in nature. Common types of deductible business expenses include:.