Summer Income Tax Reminder – Did You Know? (2/2)
Americans of all ages with summer income from self-employment may need to pay estimated tax on a quarterly basis in order to avoid IRS penalties. Alternatively, if you have self-employment earnings but also work as an employee, the IRS Withholding Estimator tool (link below) can help you determine the correct withholding amount to cover your income and self-employment tax responsibilities.
You may also qualify to reduce your tax by deducting business expenses. A tax professional can help you comply with record keeping requirements, and fully prepare for any tax implications of your summer endeavors.
IRS Withholding Estimator: https://www.irs.gov/individuals/tax-withholding-estimator