If you're like most taxpayers, you receive the salary and wage your employer and never have to worry about making estimated tax payments.
Even if you receive additional income, such as interest and dividends, stock gains, or an independent income tax withheld from wages usually covers your tax on total income.
If you have significant income other than wages, all you need to do is increase the amount withheld from your salary to your taxes are covered.
If you have little or no tax withheld on salaries and other earning significant income, however, you may need to make quarterly payments estimated tax to the Internal Revenue Service (IRS).
Otherwise, you may have interest and penalties when you file your tax return.
If you have taxable income as a freelancer, small business owner, entrepreneur or investor, you need to calculate your estimated tax and determine if you need to make quarterly payments.
you may also need to make estimated tax payments if you have a set income, unemployment benefits, or tax-free withdrawals from retirement plans.
do not worry about estimated tax payments if you expect to only have a small amount of tax. You must pay quarterly estimated tax payments if you expect a tax bill of at least $ 1,000 when you file.
Even if you have more than $ 1,000 when you file, you will not pay a penalty if your total income tax withholding and estimated tax payments in a timely manner at least 0 cent of the tax shown on the return of this year, or 100 percent of the tax shown on the tax return for the previous year.
This is called the "safe harbor amount."
the refuge provision is particularly useful if your income fluctuates significantly or if you do not know with certainty how much profit you will do for the full year until you end calculations year.
If you think you may need to make estimated tax payments, use TaxAct in calculating such amounts. TaxAct can help you estimate your payment based on the calculation of the spreadsheet or your tax liability for the previous year
Note :. Farmers and fishermen are given special attention to the estimated tax payments. You only have to pay 66.6 percent of the estimated tax liability for the current year, if two-thirds of your gross income from farming or fishing.
If you have zero tax liability for the previous year and that you are a US citizen or resident alien all year, you should not make payments estimated for this year.
However, if you have significant revenues for this year, you can choose to make quarterly payments anyway if you are not faced with a huge bill at tax time.
filing dates for federal quarterly estimated tax payments.
of estimated tax payments are due on a quarterly basis, however, the due dates are not perfectly spaced throughout. year
The estimated tax payments quarterly due dates are as follows:
| Pay Period | Due Date |
| January 1 to 31 March | April 15 |
| 1 April - 31 May | June 15 |
| June 1 to August 31 | September 15 |
| September 1 to 31 December | January 15 |
You do not have to make payment due January 15 e if you file your tax return by 1 February st and pay the full balance due with your return.
If the due date falls on a weekend or holiday, your quarterly payment is due the day of the company.
How to make quarterly estimated tax payments.
There are several ways to make estimated tax payments. If you have an overpayment on a year tax return, you can use it to get ahead of the estimated tax payments for the following year.
It is as simple as the application of all or part of the overpayment in the first quarter of responsibility instead of receive as a tax refund you next year.
If you figure your quarterly payments with TaxAct and print coupons quarterly payment, just send the coupon and your check or money to the IRS each due date.
Another easy way to make payments quarterly estimated taxes is through electronic funds withdraw. With this method, you have quarterly payments deducted from your bank account automatically. You can set this up in TaxAct.
The IRS also accepts credit and debit card payments by telephone and on its website at irs.gov. Know that you have to pay your bank convenience fee for using a debit or credit card.
Perhaps the best way to make quarterly estimated tax payments is by electronic Federal Tax Payment System (EFTPS). This is a free online payment system. Make sure you plan ahead to use EFTPS -. You can not set up or use it to pay tax on the last day
Do not forget to make tax payments of estimated state, if necessary
.strategies to make estimated tax payments easier
the greatest obstacles to make estimated tax payments remember to make payments and have money in hand to do it.
As you receive income throughout the year, try to set aside an amount for taxes. If you create a separate account for taxes, you can transfer money in once a week or month so you know the money is there when you need it
If you receive a large part of the money. For example, if you sell a great asset at a gain, intend to put a portion of your gain on your tax reserve account, or make an additional payment to the IRS. This way you know you have covered your taxes.
On the other hand, if you make less money during the year or have more deductions than you expected, you can always decrease the amount of your estimated tax payments.
at least once a quarter consider recalculate your estimated taxes for the year. This way, you do not have big surprises about your tax liability at year end.
Mark due dates for estimated tax payments on your calendar. If you are someone who needs to make quarterly payments, these are some of the most important dates of the year to remember.
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