Q. How does the IRS know that I received this income during the 3rd and 4th quarters?
A. They don't. You have to tell them.
Q. My understanding was that you only send quarterly payments with no forms indicating your income for that quarter - the payments are based on your total estimated annual income. So will I be penalized for these quarters too, if the IRS is only interested in total annual amounts?
A. If you send in four (4) equal estimated payments, then it doesn't matter that your payments match your income. When TurboTax sees that you have entered four unequal payments (or less than 4 payments), it will ask you to enter your income by quarter and fill out form 2210 to calculate the under payment penalty.
