121: What You Need to Know About Self-Employment Taxes

White Coat Investor Podcast

Dr. Jim Dahle of the White Coat Investor

Medicine, Health & Fitness, Business, Investing

4.9 • 2.3K Ratings

🗓️ 29 August 2019

⏱️ 44 minutes

🔗️ Recording | iTunes | RSS

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Summary

Dealing with self employment taxes can be a little tricky. In this episode I discuss quarterly payments or a way to avoid making them if you have W2 income as well to avoid penalties by being in the safe harbor. Bear in mind, what you pay in advance or what is withheld, may have little to no relationship to how much tax you actually owe. So I discuss what we do in our monthly financial plan to ensure that we have adequate money to pay our tax bill come April 15th. Spoiler - investing your money set aside for taxes is a bad idea. You really don't want to owe money to the IRS. They have a lot of rights that most lenders do not have, like being able to garnish your paychecks, take money out of your bank account, and send you to jail. We also discuss your term life insurance needs and how to invest that insurance money in the unfortunate situation that you become the beneficiary of a term life insurance payout. Other questions we answer are about paying off debt vs investing, self directed IRAs, mutual funds vs ETFs and dealing individual stocks. See the show notes at https://www.whitecoatinvestor.com/

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Transcript

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0:00.0	This is the White Code Investor Podcast, where we help those who wear the White Code get a fair shake on Wall Street.
0:06.0	We've been helping doctors and other high-income professionals stop doing dumb things with their money since 2011.
0:12.0	Here's your host, Dr. Jim Dolly.
0:18.0	This is White Code Investor Podcast number 121. What to do with taxes when self-employed?
0:24.0	First, though, as we get started, I wanted to thank you for what you're doing out there. I know you're working hard.
0:29.0	I know you've put in a lot of sacrifice. And sometimes we forget just how big of a deal it is.
0:35.0	And if nobody's saying thank you to you, I wanted to make sure I was the person today.
0:39.0	You know, it's interesting. I had a really interesting case this week. I had a 13-year-old who came in in cardiac arrest.
0:47.0	And it was obviously always a terrible moment when any child comes in in cardiac arrest.
0:53.0	But this heart transplant patient, after we worked on her for an hour and a half,
0:58.0	a quarter to an hour and a half, got a pulse back and sent her on to a higher level of care.
1:03.0	And I just wanted to thank all of you who've spent time and effort in your lives to be able to help somebody like that in their hour of greatest need.
1:12.0	And it was really wonderful to be able to be a part of that. And I know each of you are parts of similar miracles that happen each day.
1:19.0	So thank you for doing that. It's not easy. It's not necessarily the thing that pays the best in the world, but it is important.
1:27.0	Hey, I wanted to ask you a favor as well. A little bit of a call to action, if you will.
1:32.0	Most of the people that have heard about the White Code Investor podcast do so through one of two ways.
1:37.0	One a friend tells them about it. So thank you so much to those of you who have been telling your friends and colleagues about the White Code Investor podcast,
1:45.0	especially people who love podcasts or have long commutes anyway, where it's just a no brainer as a medium to become financially literate.
1:52.0	So thank you to those of you doing that. For those of you who are not, please suggest it to your friends. It's really helpful.
1:57.0	The second thing you can do to help get this information into the hands of your friends and colleagues is to leave us a nice five star rating on iTunes.
2:06.0	Or an Apple podcast rather. And what that does is it moves the podcast up in the rankings.
2:13.0	So people are more likely to see it when they search for other podcasts. And so that's very helpful. And we've had a lot of great reviews.
	...

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