iPhone app income and taxes - new developer

AskTaxGuru.com Junior Member, DrBeak1, asked:

Greetings forum members,

Sorry if this thread is placed in the wrong forum but I wasn't sure where it fit in.

I have been collecting income from Apple for iPhone apps that I developed since January of this year (2011). Up until today's date (October 11th, 2011) I have collected nearly $4000.00. Apple does NOT withhold taxes and therefore it is up to me to report this income. I have also come to be aware that Apple does not provide any tax forms, just sales reports, to developers.

After looking through several forums I have discovered different takes on what procedures we are supposed to follow. There appears to be two sides to the argument. The first states that we developers should report our app earnings on our regular taxes (i.e., before April 15th). These folks say these earnings should be reported on Schedule C (as a sole-proprietor business). The other camp states that developers should be paying estimated-taxes quarterly, which I think is to some degree based on making a certain amount of cash--or reaching a certain threshold per month. So, which is correct?

Are there any of you out there that have experience with this and can provide some insight?

Thanks in advance : )

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