Business FinancesQuestion 287 of 690
A self-employed contractor operating as a sole proprietor with no withholding generally must make federal income tax payments to the IRS:
a.Only once per year on April 15
b.Monthly with Form W-2
c.Only when the business is sold
d.In quarterly estimated tax payments
Explanation
Because no employer withholds tax from a sole proprietor's income, the IRS requires estimated tax payments made quarterly to cover income tax and self-employment tax as the income is earned.
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