If you are thinking about becoming a full time massage therapist, you may be wondering, “Are massage therapists taxed?” Well, the answer is not so simple, as the state tax laws depend on where you live. You will need to look up the state laws regarding taxes in your specific area. It is safe to say you will be required to pay income taxes and self-employment taxes if you are considered self-employed, though, in which case your income will need to be reported on schedule C of the 1040 income tax form. So once you find out whether your new career path is taxed by your state, you will want to find out what kind of deductions you can make.
If you are thinking about becoming a full time massage therapist, you may be wondering, “Are massage therapists taxed?” Well, the answer is not so simple, as the state tax laws depend on where you live. You will need to look up the state laws regarding taxes in your specific area. It is safe to say you will be required to pay income taxes and self-employment taxes if you are considered self-employed, though, in which case your income will need to be reported on schedule C of the 1040 income tax form. So once you find out whether your new career path is taxed by your state, you will want to find out what kind of deductions you can make.
If you brought in more money than the amount of your allowable deductions, you will be taxed on the remaining profit. You are required to pay the IRS a portion of your business profit as self-employment tax as well as part of your business profit as income tax. Self employment taxes are currently at a rate of 15.3 percent for all businesses with profits of up to $87,900. Income taxes are added on top of that, which can range from 10 percent to 38 percent, depending on your income and marital status. State income taxes would then be added on top of this if you live in a state that taxes income.
There are obviously a lot of taxes that can quickly eat up a chunk of the profits from your massage therapy business, which is why you need to make as many deductions as possible. For every dollar you spend in deductions you save about 30 percent in taxes. Anything that you spend money on for the sake of your business is a deduction, so you need to save receipts and keep careful track of everything you spend that relates to massage and running the business. Your car, office rent, massage tables, equipment, advertising, telephone, fax, website, business travel, ongoing education expenses, licensing fees and association membership dues may all be considered tax deductions. If you’re smart about it, you shouldn’t have to pay very many taxes at all. If you’re still trying to figure how much are massage therapists taxed, you should probably consult a tax professional to help.
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