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Originally Posted by divagrrrl
I'm still so confused.... I am leaning towards rooting for abolition of federal taxes as we know them, and replacing it with a Value-Added tax like in the UK and other countries... in other words, a national sales tax.
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divagrrrl, are you including in the federal tax bill amount that you quoted,
the approximate 15% tax on your income that self proprietors must pay for
social security and medicare taxes? When you do not work for an employer,
you are obligated to pay twice the amount that employees of a company
pay, since you have no employer to pay the other half of these taxes.
When you become eligible to collect social security, either due to diability,
or when you reach retirement age, your benefit amount will be correlated to
the amount that you "contributed" to the social security system during your
income earning years.
If this amount of tax is the bulk of your federal tax
obligation, and competition determines the rates that you can charge for
the services that you offer, maybe your self employed competitors are not
taking all of their expenses, including their self employed tax burden, into
account when they set their rates. Is there an association that many members of your profession are members of? Maybe communicating the
true costs of doing business to many of your fellow therapists would be the
quickest way to increase all of your competition. Are there too many
therapists offering the service that you offer to too small of a customer
base?