Is your max deferral $800 or $5130? The amount you opt to defer (the amount on Schedule 3, Line 12e) is factored in if using method 2 below, but you can opt to use the higher method (opt 1). The deferred amount lowers the amount of your 2020 'Other Taxes' amount. Based on your 2020 tax info, we’ll use the lower of the following IRS-approved methods to calculate your estimated tax payments.
- 90% of your estimated 2021 taxes
- 100% (110%) of your actual 2020 taxes
There are two additional IRS approved methods available:
- 100% of your estimated 2021 taxes
- 66 2/3% of your estimated 2021 taxes (farmers and fishermen only)
If you’d like to use one of the additional methods, answer Yes to the question "Do you want to adjust your income or deduction?" on the Review Your Estimates for 2021 screen. Once you review your income and deductions, you’ll have the option to select from any of the four methods.
You can choose the higher option and generate the payment vouchers by doing this:
- With your tax return open, search for 1040-es (be sure to include the dash) and select the Jump to link.
- Answer No to the question Do you want to change your W-4 withholdings for 2021?
- Answer the questions about things like your 2021 filing status, income, and deductions.
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