Best Ways to Avoid Self-employment Tax Penalties
When a taxpayer is self-employed they are often required to send in quarterly estimated tax payments to the IRS. The situation can become ambiguous and muddled when, as with most businesses, income vacillates from month to month or year to year. It can be difficult at the point to determine estimated tax payment amounts that will keep you out of the penalty zone. If you send to much your routine expenses will be a struggle now, but if you send too little you are going to be subjected to the estimated tax penalty on top of an already hefty tax bill. Let’s look at some of the best methods in avoiding self-employment tax penalties.