Hello,
Congrats on starting some freelance work in addition to your part time job!
To answer your question as to how to calculate your quarterly estimated tax payments or whether to increase your withholding from your part time job, the rule is that you must pay your taxes as you go throughout the year through withholding or making estimated tax payments.
- If your federal income tax withholding (plus any timely estimated taxes you paid) amounts to at least 90 percent of the total tax that you will owe for this tax year, or at least 100 percent of the total tax on your previous year's return (110 percent for AGIs greater than $75,000 for single and separate filers and $150,000 for married filing joint), you most likely will not need to make estimated tax payments.
You should estimate the amount of money you are going to make through your part time job and your freelancing job. Then you can use our Taxcaster tool to figure out how much tax you are likely to owe. Here is the link to our Taxcaster tool:https://turbotax.intuit.com/tax-tools/calculators/taxcaster/
After you have determined your tax liability , you have 2 options to ensure you are paying enough tax throughout the year.
1. Increase your withholdings by submitting a new W4 to your employer and have additional tax withheld to ensure you pay at least 90% of your liability or 100% of last years amount.
2. Figure out how much you still have to pay after what you have withheld from your part time job and make estimated payments quarterly for the difference.
Quarterly estimated payments are due April 15, June 15 , September 15 and January 15
I hope this answers you questions!
Mary, Tax expert
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