Pay as you go so you won’t owe. In a nutshell, that’s how the IRS wants you to pay your income taxes. If you are on the payroll of an employer, income taxes will be withheld from each paycheck and remitted to the IRS by your employer. If you are self-employed or otherwise receive income without withholding, such as through a K-1, you pay as you go by making quarterly estimated tax payments. Quarterly estimated tax payments are due on April 15, June 15, September 15 and January 15 of the next year. These estimated payments are based on your expected taxable income for the year. In order to avoid penalties you must pay in 90% of your current year’s tax, or 100%/110% of your prior year’s tax, depending on your income level. For assistance calculating your estimated tax payments please feel free to contact us.
