The end of last week was so crazy, what with the Treasury tax refund debit cards and the beginning of the 2011 e-file and Free File season, that this annual tax deadline almost slipped right past me, both from blogging and personal tax perspectives!
Estimated tax payments are due once again on Tuesday, Jan. 18.
These payments are required when you get money that's not taxed via payroll withholding, such as self-employment income, investment earnings, prizes or even alimony.
This is the fourth and final filing of a 1040-ES voucher for the 2010 tax year, covering untaxed earnings between Sept. 1 and Dec. 31.
While these estimated tax payments usually are referred to as quarterly, that moniker is based on the fact that there are four of them. As the table below indicates, it's definitely not because they follow our calendar's regular quarters.
|Estimated tax due:||For income received between:|
|April 15||January 1 through March 31|
|June 15||April 1 through May 31|
|September 15||June 1 through August 31|
of the following year
|September 1 through
Technically, this final 1040-ES of the previous tax year is due today, Jan. 15.
But because today is a weekend day, the due date shifts to the next business day. And that's Tuesday, Jan. 18, because Monday is the federal Martin Luther King, Jr. holiday.
Timing is everything: Even better news, your tax payment doesn't have to actually be there on Tuesday.
The "timely filed" rule applies here as it does with your annual 1040. That means your voucher and payment simply must be postmarked on the 18th if you file using the Postal Service.
If you have set up an Electronic Federal Tax Payment System, or EFTPS, account, you can pay your estimated taxes that way.
Or you can pay using a credit or debit card. The IRS has three official plastis payment vendors this year:
- LInk2Gov Corp. at www.PAY1040.com
- RBS WorldPay, Inc. at www.payUSAtax.com
- Official Payments Corp. at www.officialpayments.com
And finally, if you promise you'll file your 2010 Form 1040 and pay the entire balance you owe Uncle Sam by Jan. 31, then you don't have to make this Jan. 18 estimated tax payment. Yeah, that doesn't work for me either.
Other estimated calculation options: Most folks pay their estimated taxes in four equal installments. Even if your income doesn't arrive regularly, the process is easier to keep track of throughout the year.
But you also can pay using the annualized method, meaning you calculate the tax amount you owe on just the income you've actually received.
Obviously, that's more complicated and requires more IRS forms (meet Form 2210), but it could help with your cash flow.
Whatever estimated tax filing method you use, just make sure you meet the deadlines. And in 2011, the first one of the year is on Tuesday, Jan. 18.
- Figuring your estimated tax amount
- Midyear tax tip: Evaluate your estimated tax situation
- Estimated tax payment due TODAY! (Sept. 15, 2010)
Want to tell your friends about this blog post? Click the Tweet This or Digg This buttons below or use the Share This icon to spread the word via e-mail, Facebook and other popular applications. Thanks!