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Answer to Question #93183 in Microeconomics for John Manda
Question #93183
"Paying tax is being independent" Discuss
Expert's answer
The amount of money taken out by the owner does not affect their taxes. Individuals are required to pay federal taxes. They must be paid on income as you earn whether one takes it out or not. Medicare and security taxes must be paid and this tax is considered self-employment tax for all independent contractors.
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