She said she made estimated tax payments. What she didn't say was whether or not the advisor she used warned her about self-employment taxes, and whether or not she accounted for any potential income increase in the following year. It also said nothing about filing a Schedule C, to deduct business expenses. (It's also possible that, running her business on TikTok doesn't give her much to write off.) Using a tax person who mostly does W-2 type of returns and doesn't understand the implications of being self-employed (especially if that person is oneself), is a recipe for this type of problem!
As was already said, it's all about doing more homework on what it means to run a business beyond today's version of getting a commission and hanging up a shingle... |
