TAXES involved with selling insurance
- Thread starter MattHayek
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Being self employed, the amount of your sales wont be the main item triggering what you will send in as estimated taxes. you really wont have a great idea until you know both your revenues(commissions) from sales & your expenses. until then, you will have to be good at budgeting such as having 25-40% of your gross deposited in a different bank account so you have it when you have to pay quarterly taxes. Federal rate for household income + your state rate + the 15+% self employment/FICA payroll tax.
However, as important as taxes, formal businesses plans, getting more educated, etc none of them matter until you are licensed & you start seeing dozens of people weekly. without becoming an expert on activity, you wont have any need for any of the knowledge, the license or a workflow on best practices for taxes
However, as important as taxes, formal businesses plans, getting more educated, etc none of them matter until you are licensed & you start seeing dozens of people weekly. without becoming an expert on activity, you wont have any need for any of the knowledge, the license or a workflow on best practices for taxes
Income taxes as a producer/insurance professional? Or by some chance are you talking about "premium tax" and that aspect?
If the former, it depends on who you work for, with, and how it's structured. I would suggest that if you know where you will be working, get all of the details from them and speak with your accountant. Good luck in your new career!
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Without becoming an expert on activity, you wont have any need for any of the knowledge, the license or a workflow on best practices for taxes.
Disagree. As a business owner, the goal is to get business. Assuming you will get business, taxes come with it. Why not be prepared? Especially when you need a break from learning the business.
Disagree. As a business owner, the goal is to get business. Assuming you will get business, taxes come with it. Why not be prepared? Especially when you need a break from learning the business.
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Personally, I agree with you. however, after watching over 1,000 new agents launch over the last 25 years, those that spent time before launch figuring out what their business card should look like, studying if they should be sole prop, C corp, LLC, researching & studying taxes & payroll services were out of business at a much higher rate in 12-24 months than those that spent all their free time before starting making lists of people to contact, getting the word out in advance what they would be doing, connecting with referral partners.
Watched a ton of super knowledgeable people net zero in the business from using research as distraction tool of making calls, door knocking, etc. Exceptions to everything for sure.
Some of this doesn't apply if someone has been already in the business, licensed & has experience under their belt. but I took the OP as studying for the 1st time to get licensed. A mentor can help with some of these other items as they launch
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Matt, there are more factors involved than can be answered on a post here. However, if you set aside 20% of the commissions paid to you, you will most likely be fine.
Remember to track your expenses:
1. Business mileage: most use an app like Mile IQ. For many, this is their biggest expense.
2. Office supplies.
3. Equipment such as a work computer.
4. Part of your phone bill.
5. E&O insurance.
6. Any many others.
Keep a separate bank account and credit card for business income and expenses. Keep your receipt copies. Have a separate savings account for your taxes. That should get you started.
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You are a beginner. Do like the professionals do and hire yourself an experienced CPA. You need to focus on bringing in the $$$ and controlling your expenses.
