Hi!
My husband started a counseling business in 2021. He made very little money, as it is just a side job right now; he works full time at another job which he receives a wages and a W-2. I have submitted 2021 taxes using our usual 1040 and this time filling out the Schedule C. Fyi he is not an independent contractor; he would never receive a 1099 NEC. Clients pay him directly and we have ledger software that keeps track of all that.
My issue comes to estimated quarterly taxes. As I said, he makes little money on that job and therefore would only pay small amount of taxes. However, the 1040-ES seems to take in to account all his income when estimating tax payments. We don't have much federal withheld from his wages job because we like to break even at the end of the year (we have 2 kids and get the child tax credit). So, when I make the calculations on the 1040-ES, it looks like we would have to pay quite a bit every quarter. I can't tell if I can list the child tax credit on line 7 (the instructions don't make it appear so). If I can't, then the tax owed is huge.
My big question is this: Could I just estimate the taxes due on his self employed income myself without the 1040ES and just pay that, or am I going to get fined for not meeting the minimum payment because I didn't account for his wages job (which, of course, never mattered before because I never had to calculate estimated taxes on a job that automatically has withholdings)? I apologize if I'm going in circles here. Does this make ANY sense? Thanks in advance!
