Self Employed as a Senior?

These days, it’s more common than ever for senior citizens to go into business for themselves. Whether they open up official businesses or just start doing extra work, like nannying or pet-sitting, on the side, the fact remains that today’s seniors are putting off retirement in favor of earning more money.   

And, while earning more money is always a good thing, self-employed seniors, meaning those over the age of 65, should be aware of some rules that typically apply to them. They, for example, are usually required to file both business tax returns using Schedule C and personal tax returns.

Furthermore, self-employed seniors will have to pay the self-employment tax rate, which can be steep. With a little know-how, though, they can typically qualify for deductions that can help them to save. For example, half of your social security tax, in most cases, can be deducted on Form 1040, which will bring down your adjusted gross income and, thus, your overall taxes.

Another thing to keep in mind is that, in most cases, you can continue collecting Social Security benefits as well. You just have to remember that if you go over the maximum taxable earnings amount, your benefits may be reduced. Social security benefits are reduced $1 for every $2 you go over the income maximum.

To learn more about how your social security benefits might be affected by being self-employed as a senior or for general questions about self-employment and what it means for you tax-wise, don’t hesitate to seek help from a qualified accountant.

The friendly tax experts at Lewis CPA are always happy to assist you with all of your tax questions and needs, no matter what your age or your employment status, so don’t hesitate to contact them!