I want to just annualize my self employment income and not try to break it out by mont- How do I un-do that question

posted

The reason for asking that is in case you didn't set aside enough for taxes, which are due quarterly. In other words, if you owed $100 for taxes in each quarter, you might have underpaid for three quarters even if you pay $400 in the fourth quarter.

Here's a few workarounds:

1) If you aren't worried about underpayment penalties, just report all your income in the last month of the year. Enter zeroes for the first 11 months.

2) If you want to MAXIMIZE the possibility of underpayment penalties, which you still might not owe, report it all in the first month.

3) If your income was basically steady all year, report 1/12th each month, or report 1/4 each quarter, it doesn't matter what month in the quarter.

4) Split the difference, report half in June and half in July :-).

In the end, it probably won't matter, but in general, the goal is just to pay the taxes you owe, however you fill out the forms. As a fellow citizen/resident, thanks for reporting your income and paying your taxes 🙂