Q. SHOULD I still file 2021 estimated taxes?
A. It's optional; depending on whether you want to pay now or later.
You usually should make estimated tax payments for the current tax year if both of the following apply:
- 1. You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits.
- 2. You expect your withholding and credits to be less than the smaller of: 90% of the tax to be shown on your current year’s tax return, or 100% of the tax shown on your prior year’s (2020) tax return. (110% if your income will be more than $150K) .
Even if you don't meet those rules, it's still optional But you will probably end up with an underpayment penalty.
If your goal is just to avoid the underpayment penalty, then paying 100% (110% for higher income) of the prior year tax liability is the “safe haven”
