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Bayou Tiger
LSU Fan
The Woodlands, TX
Member since Nov 2003
3366 posts

Quarterly Tax Payment Vouchers

TurboTax spit out four 1040-ES payment vouchers with my return suggesting that I send the IRS thousands of dollars every quarter.

Why can't I just pay my taxes at the end of the year? Income varies on a year-to-year basis, and last year hit the high side. If I let the IRS eat a dick and pay my full taxes next April, what is the downside?

ETA: I paid a lot of money last year in taxes and still owed a lot on my tax return, so I am not exactly itching to send even more money just yet.


McNeeseLSU
McNeese State Fan
Baton Rouge
Member since Feb 2007
255 posts

re: Quarterly Tax Payment Vouchers
As long as you pay in 90% of your current year tax or 100% of your previous year tax, you will avoid an underpayment penalty
This post was edited on 3/3 at 2:25 pm


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756
LSU Fan
Member since Sep 2004
10879 posts

re: Quarterly Tax Payment Vouchers
are you self employed? do you have a second income?


Bayou Tiger
LSU Fan
The Woodlands, TX
Member since Nov 2003
3366 posts

re: Quarterly Tax Payment Vouchers
quote:

are you self employed? do you have a second income?
Neither. Does that affect the quarterly payments?


rmc
LSU Fan
Zachary, LA
Member since Sep 2004
22788 posts
Online

re: Quarterly Tax Payment Vouchers
You only need to remit quarterly payments if you have some income that is 1099'd. If you are W-2, I think you are good to go without quarterly payments. I'll let a tax professional give a more definitive answer.


Poodlebrain
LSU Fan
Way Right of Rex
Member since Jan 2004
17607 posts

re: Quarterly Tax Payment Vouchers
The only reason TurboTax would generate 1040-ES vouchers is because your withholding for 2012 was less than your 2012 tax liability. I suggest you analyze the W-4 you have on file with your employer. You may want to increase your withholding.


medtiger
LSU Fan
Cubs Fan
Member since Sep 2003
18103 posts

re: Quarterly Tax Payment Vouchers
quote:

You only need to remit quarterly payments if you have some income that is 1099'd. If you are W-2, I think you are good to go without quarterly payments.


Not true at all. If you have too little withheld on your w-2, you could get a penalty if you don't pay estimated taxes. Here's the IRS info:

LINK


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Bayou Tiger
LSU Fan
The Woodlands, TX
Member since Nov 2003
3366 posts

re: Quarterly Tax Payment Vouchers
quote:

I suggest you analyze the W-4 you have on file with your employer. You may want to increase your withholding.
Thanks. I just did this and it seems to be the most palatable approach. I targeted my withholdings to hit around 92% of anticipated tax due.

That way I won't pay the penalty for underwitholding, won't give the government an interest-free loan, and won't have too much taken out of each paycheck (i.e. if targeting 100%).


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