This is the first year that I will have to pay quarterly estimated taxes, since I have income but no withholding. I had planned to use part of my 2018 refund to pay the first quarter, but now I am likely going to file for an extension (my first ever). Does that mean I’ll have to pay the
first quarter of estimated taxes for 2019 separately?
Also, how do I figure out if I even have to pay estimates for the first quarter? While I know roughly what my annual income will be (high enough to trigger the required estimated payments), it is quite lumpy. The biggest lump (about half the annual total) has timing I can control and I haven’t elected to receive it yet. My first quarter income was around $3,500. Expected annual income is more like $40,000.
It’s a stupid long form. It not only has to do with your first quarter + year’s estimated AGI, it has to do with your last year’s taxes as well which makes things harder if you file for an extension. Here’s the worksheet. Please let me know if I can help. It may make you want to smash your fists into pillows. Here is the worksheet, it’s on page 8 of this packet
Remember state + local taxes too if you need to pay those! I didn’t have to pay quarterly federal because my estimated taxes were too low but I did have to pay state.
Updated to add: quarterly taxes are not a science and the IRS is very gentle with them if you just put in an effort, so if you send at least 90% of 1/4 of what you paid last year total, they will be fine with it. (So like if you owed roughly $2000 in taxes all year last year, send them $2000/4 *.9 = $450.) Just send them something if you’re above the threshold and they will not get cranky.
Thanks for the info. Not what I was hoping for, but best to be informed. I’ll probably suck it up and try to get Federal done tonight. I’ll just pay (or, rather, not get refunded) the $400 that I think I shouldn’t have to pay but a strict interpretation of the healthcare subsidy rules say I need to pay.
Obviously I don’t know your own tax situation but you still have 24 hours to dump some $$$ in a 2018 Traditional IRA if you need to lower your AGI for healthcare subsidy reasons.
Thanks, but that wont help. I technically became ineligible for subsidies in Nov even though there was no way to cancel my ACA plan before the end of the year. I got word I was approved for my new coverage in mid-December (after I’d paid for December’s ACA insurance, of course) and that my new coverage was retroactive to November.