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What, Why, and When of Estimated Tax Payments

The below information was taken from the IRS website and summarized for you here. If you'd like to read the full details, please visit: https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes

If you are in business for yourself, you generally need to make estimated tax payments. Individuals, including sole proprietors, partners, and S corporation shareholders, generally have to make estimated tax payments if they expect to owe tax of $1,000 or more when their return is filed. 

Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. If you don’t pay enough tax through withholding and estimated tax payments, you may be charged a penalty. You also may be charged a penalty if your estimated tax payments are late, even if you are due a refund when you file your tax return.

Individuals, including sole proprietors, partners, and S corporation shareholders, generally use Form 1040-ES (PDF), to figure estimated tax. For estimated tax purposes, the year is divided into four payment periods. Each period has a pay online, by phone, or by mail.

You can pay all of your estimated tax by April 17, 2018, or in four equal amounts by the dates shown below:

1st payment ................. April 17, 2018

2nd payment ................ June 15, 2018

3rd payment ................. Sept. 17, 2018

4th payment ................. Jan. 15, 2019

Please put the above dates in your calendar and reach out to me at 858 367-3112 if you need help.

Ryan Lee