Self-employed individuals, business owners, and those who profit through rent, alimony, sales and awards must make estimated tax payments if they expect to pay $1,000 or more in taxes as of 2015. Those filing as corporations must pay estimated taxes if they anticipate a tax bill of $500 or more.Continue Reading
Anyone whose employer does not withhold taxes is required to pay estimated taxes four times a year by April 15th, June 15th, September 15th and January 15th. The taxpayer is responsible to calculate the correct amount based on adjusted gross income, taxable income, credits and deductions. Those who underpay estimated taxes face penalties, although the penalty is waived if the taxpayer pays at least the amount of the previous year's taxes or 90 percent of the current year's tax bill.
If those liable for estimated tax payments also work for wages, they can request that their employer withhold additional taxes to cover the amount of estimated taxes. Taxpayers can also credit overpayments on previous tax returns to pay estimated taxes, mail payments with quarterly payment voucher forms, pay through the IRS e-file system with electronic funds withdrawal, or pay by phone or online using the Electronic Federal Tax Payment System. Many taxpayers make equal quarterly payments, but those whose incomes fluctuate significantly throughout the year can calculate quarterly estimates and make unequal payments.Learn more about Income Tax