There will be no federal penalties for not paying in enough taxes during the year if withholding...
1) and timely estimated tax payments equal or exceed 90% of your 2023 tax or
2) and timely estimated tax payments equal or exceed 100% of your 2022 tax (110% if your 2022 adjusted gross income was more than $150K) or
3) the balance due after subtracting taxes withheld from 90% of your 2023 tax is less than $1,000 or
4) your total taxes are less than $1,000
the lower of 1 or 2 is your required annual income tax payment. 1 is difficult to know until the year-end so generally option 2 is the safer option. Under the simplified method 25% of the estimated taxes must be paid in each period by 4/18, 6/15, 9/15 and 1/15/24. Unless you can show otherwise 25% of your annual withholding is assumed to occur in each period.
