Question

Content areataxpayers with self-employment income who also have form w-2 wage income from employment may be able to avoid making estimated tax payments by filing a form w-4 and increasing the amount of their withholding.

O true
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Answer 1

Taxpayers with self-employment and Form W-2 wage income can adjust their W-4 to increase withholding, potentially eliminating the need for estimated tax payments and avoiding underpayment penalties.

Step-by-step explanation:

Taxpayers with self-employment income who also have Form W-2 wage income from employment may indeed avoid making estimated tax payments by adjusting their withholding on Form W-4. This can be achieved by increasing the withholding amount from their W-2 wages to cover the tax liability for their self-employment income, thus potentially eliminating the need for separate quarterly estimated tax payments.

Individuals are responsible for ensuring that enough taxes are paid over the course of the year, whether through withholding from a paycheck or by making estimated tax payments, to avoid underpayment penalties.

By correctly filling out a Form W-4 and adjusting the amount of taxes withheld from the paycheck, a taxpayer with both employment and self-employment income can better manage their tax obligations and potentially simplify their tax situation.