Sole proprietors are subject to self-employment taxes on net income from their sole proprietorships. TRUE/FALSE?

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Sole proprietors are subject to self-employment taxes on net income from their sole proprietorships. TRUE/FALSE?

Sole proprietors are subject to self-employment taxes on net income from their sole proprietorships.

TRUE/FALSE?

business accounting

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Answer 1

Answer #1

Answer: True

Explanation:

Sole proprietorship is also known as the sole trader, individual entrepreneurship which means the enterprise should be owned and run by one person and in which there is no legal distinction between the owner and the business entity.

The sole proprietorship is not a legal entity. It simply refers to the person who owns the business he is the only responsible for its debts.

A Sole proprietor is the only owner of that business who pays personal income tax on profits earned.

Therefore, a sole proprietors are subject to self-employment taxes on net income from their sole proprietorship.

Thus, the given statement is true.

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Answer 2

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Sole proprietors are subject to self-employment taxes on net income from their sole proprietorships. TRUE/FALSE?

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