I have the following example values of:

  • Self Employed LLC Income: 50K (Computer Repair Business)
  • Married filing jointly
  • 2 children
  • No mortgage or property. We rent.
  • Paying for daycare - $800/month.
  • No investments

  • Is there a tax form simulator to estimate my taxes to get a rough idea of what I can deduct and owe?
  • What forms are required from the given values above? I just know about 1040.

Here is a tax 1040 simulator: https://www.jacksonhewitt.com/tax-tools/tax-refund-calculators/1040-tax-calculator/ -- There is actually quite a number of them if you google for "1040 Tax Simulator"

The main points to know about for filing taxes is the following from my research thus far:

  • Know the difference from a deduction and a tax credit. A deduction reduces your taxable income. Example: You make 100K and deduction is 10K. You get taxed on 90K only. A tax credit is to reduce your TAX amount. Example: Ignore how much you make. You owe 9K in taxes, your tax credit is 1K. You pay 8K in taxes.
  • Total income means before Adjusted Gross Income (AGI). AGI is your Total Income MINUS all the Adjustments to Income category on Schedule 1. See below:

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  • Understand the basic Standard deductions. Married you get to "deduct" 24K from your income. Thereby reducing your taxable income.

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  • Self Employment Tax (Form Schedule SE) you always get 50% off of it. See below:

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