Are you considering joining the Great Resignation and becoming self-employed to be in charge of yourself?

Yes?

Okay, but before leaping, consider the tax implications. This self-employment thing may not be as rosy as it appears.

Here’s the big picture.

Don’t Believe the Hype

Despite what some may believe, becoming self-employed won’t allow you to

write off all your meals as a business expense,

deduct the cost of taking your friends to sporting events,

deduct all your transportation expenses, and

write off the entire cost of owning or renting a residence that contains your home office.

Sorry about that.

While there are some tax advantages to being self-employed, they are underwhelming and should not be the main reason for deciding to go out on your own. We cover tax benefits later in this analysis.

The big non-tax disadvantage is you’ll have to pay for things that were formerly provided by your employer, such as

health insurance,

retirement plan contributions,

a company car (if you were lucky),

company-paid business trips that included elements of pleasure,

meals when you worked late at the office, and

so forth.

And there is one big tax disadvantage: the dreaded self-employment tax.

Now, some details on the tax issues most likely to affect you as a self-employed taxpayer.

The Dreaded Self-Employment Tax Can Be Really Expensive

The self-employment tax is how our beloved U.S. Treasury collects Social Security and Medicare taxes on non-wage income from business-related activities. ... Log in to view full article.