I'm an independent artist. I started my business (sole proprietorship) this year in January but I have yet to actually start my business in terms of income. I'm still sorting things out so I have no business activity yet but will hopefully soon. Am I required to pay estimated quarterly taxes this year or do I not have to worry about it since this is my first year in business? I've been doing a lot of research but I'm still really confused. If I do have to pay, how do I do it?
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Do I need to make estimated tax payments to the IRS?
PAYING ESTIMATES
For SE self employment tax - if you have a net
profit (after expenses) of $400 or more you will pay 15.3% for 2015 SE
Tax on 92.35% of your net profit in addition to your regular income tax on it.
So if you have other income like W2 income your extra business income might put
you into a higher tax bracket.
You must make quarterly estimated tax payments
for the current tax year (or next year) if both of the following apply:
- 1. You expect to owe at least $1,000 in tax
for the current tax year, after subtracting your withholding and credits.
- 2. You expect your withholding and credits to
be less than the smaller of:
90% of the tax to be shown
on your current year’s tax return, or
100% of the tax shown on your prior
year’s tax return. (Your prior year tax return must cover all 12 months.)
https://ttlc.intuit.com/replies/3301891
How do I make estimated tax payments?https://ttlc.intuit.com/replies/3301258
Do I need to make estimated tax payments to the IRS?
PAYING ESTIMATES
For SE self employment tax - if you have a net
profit (after expenses) of $400 or more you will pay 15.3% for 2015 SE
Tax on 92.35% of your net profit in addition to your regular income tax on it.
So if you have other income like W2 income your extra business income might put
you into a higher tax bracket.
You must make quarterly estimated tax payments
for the current tax year (or next year) if both of the following apply:
- 1. You expect to owe at least $1,000 in tax
for the current tax year, after subtracting your withholding and credits.
- 2. You expect your withholding and credits to
be less than the smaller of:
90% of the tax to be shown
on your current year’s tax return, or
100% of the tax shown on your prior
year’s tax return. (Your prior year tax return must cover all 12 months.)
https://ttlc.intuit.com/replies/3301891
How do I make estimated tax payments?https://ttlc.intuit.com/replies/3301258
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