Which Statement Pertaining to Estimated Tax Payments Is Not Correct

question 26

Multiple Choice

Which statement pertaining to estimated tax payments is not correct?

• A)An individual, whose only income is from selfemployment, will have to pay estimated payments
• B)If insufficient tax is paid through withholding, estimated payments may be necessary
• C)Estimated tax payments are required when the withholding taxes are greater than the overall tax liability
• D)Estimated tax is used to pay not only income tax, but self-employment tax and alternative minimum tax as well

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Definitions:

Personal Income Taxes

Taxes levied on the income of individuals, typically graduated so that higher income levels are taxed at higher rates.

Progressive

Describes a tax system where the tax rate increases as the taxable base amount increases, typically aimed at reducing income inequality.

Proportional

Having a constant relation in degree or number between two or more variables.

Regressive

Describing taxes or policies that take a larger percentage from low-income earners than from high-income earners.