Are there ways to lower your Social Security and Medicare taxes?

As an independent Contractor, we pay both side of the Social Security and Medicare tax. Are there ways to low what you pay? I'm 65, on Social Security and Medicare. Doing mystery shopping, I'm still paying into both, but won't get anymore back from them. If I meal cost me $45, and the shop pays a $35 fee, no reimbursement, can I write off part of the meal as an expense for doing the shop? and would this lower my Social Security and Medicare tax?

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Your income from that shop is $35 and your expenses are $45, so your net income is -$10. Lowering your net income will lower your SS/medicare taxes... but you're making less money overall.

Edited 1 time(s). Last edit at 12/02/2018 09:00PM by boridi.

Johnb: Since you are currently 65 and collecting Social Security, you are collecting before you reach full retirement age. So, be careful. You will lose $1 for every $2 you make over $17,040 (2018 threshold, it will go up in 2019) until you reach full retirement age. Here is a link to the Social Website: [www.ssa.gov] In some convoluted way, your monthly SS monthly payment will eventually go up since you are earning money after retirement and paying into SS, but even my accountant (also a tax attorney) can not explain how long it will take to make up for the $1 per $2 that is lost.

Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008

@boridi wrote:

Your income from that shop is $35 and your expenses are $45, so your net income is -$10. Lowering your net income will lower your SS/medicare taxes... but you're making less money overall.

I consider the $35 is that much less I have to pay on food.

@myst4au wrote:

Johnb: Since you are currently 65 and collecting Social Security, you are collecting before you reach full retirement age. So, be careful. You will lose $1 for every $2 you make over $17,040 (2018 threshold, it will go up in 2019) until you reach full retirement age. Here is a link to the Social Website: [www.ssa.gov] In some convoluted way, your monthly SS monthly payment will eventually go up since you are earning money after retirement and paying into SS, but even my accountant (also a tax attorney) can not explain how long it will take to make up for the $1 per $2 that is lost.

My earned income won't even come close to $10,000 a year.

@johnb974 wrote:

@boridi wrote:

Your income from that shop is $35 and your expenses are $45, so your net income is -$10. Lowering your net income will lower your SS/medicare taxes... but you're making less money overall.

I consider the $35 is that much less I have to pay on food.

That's great, but you'll be paying less in taxes because you're losing money on the shop.

By keeping exquisite records, you will lower your taxes as much as legally possible.

You need to consult with a tax professional, rather than shoppers (who have various, and wrong, advice!).

@ceasesmith wrote:

By keeping exquisite records, you will lower your taxes as much as legally possible.

You need to consult with a tax professional, rather than shoppers (who have various, and wrong, advice!).

Excellent advice! I'm a former tax professional and my advice is keep pristine records in digital and on paper for the rest of your life.

Answering the OP's original question, nope as a general rule. This is when I will go back to ceasesmith's advice. Contact a tax professional. Find one that understands small business, entrepreneurs.

Live your life in such a way that when your feet hit the floor in the morning; the devil shudders...And yells OH #%*+! SHE'S AWAKE!

The only reason I file taxes is because of my mystery shopping. Between Social Security and my part time job, I don't even make enough to file taxes. The Social Security and Medicare taxes are the biggest bites out of my income. I would like to find ways of reducing them.

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