If you are self-employed and don’t have taxes withheld from your pay or you don’t have enough tax withheld you may need to make estimated tax payments. Here are six tips to help facilitate making your estimated tax payments.
- If you anticipate owing $1000 or more when you file your federal tax return in 2014 you should pay estimated taxes. Special rules apply to farmers and fishermen.
- Estimate how much income you expect to make for the year and determine the amount of taxes you may owe. Make sure that you take into account any tax deductions and credits that you will be eligible to claim. Any life changes such as change in marital status or birth of a child can affect your taxes.
- Estimated tax payments are generally made four times each year. The dates that apply to most people are April 15 June 16 and September 15 in 2014 and also January 15 in the year 2015.
- You can pay estimated taxes online or by phone. You may also pay by check or money order credit card or debit card. If you mail your payments to the IRS be sure to use the payment vouchers that come with Form 1040-ES Estimated Tax for Individuals.
- Check out the electronic payment options on IRS.gov. This free and easy Electronic Filing Tax Payment System is a great way to make your payments electronically.
- Use Form 1040-ES and its instructions to figure your estimated taxes.
Additional IRS Resources:
Publication 505 Tax Withholding and Estimated Tax
Estimated Tax – frequently asked Q & As
Tax Topic 306 – Penalty for Underpayment of Estimated Tax
IRS YouTube Videos:
Estimated Tax Payments – English | Spanish | ASL
Estimated Tax Payments – English | Spanish
If this information sounds confusing or you would just like the assistance of a qualified and professional CPA to help you mutter through the lingo and paperwork of self-employed compliance fill out the brief form here and we will set up a time to meet and discuss your tax expectations and strategy for your near future.