You are amazing and I could almost cry in that I feel relief that someone is helping me.
Im still just a bit confused on the estimated tax and when a penalty occurs.
We did file a joint return last year but the business had a loss. I understand that I must consider tax bracket based on our last year's tax return when trying to estimate my business tax. As far as considering my husband's income too, if I pay tax estimated tax based on his income as well as mine, I would be paying amounts for taxes again throughout the year that he already has deducted from his checks so it would be a lot, more than income from the business. For instance, say total tax liability last year was 8000.00 but the business only owed 1500.00 of the income based on the earning from the business, wouldn't I do estimated tax and pay tax in accordance with our tax bracket but only enough with quarterly tax to cover taxes owed for my business? I'm so confused about this. Do I have to pay in enough tax during the year to be sure enough taxes are being taken out of my husband's pay through his employer too? In this situation, do you mean that we could be penalized if my husband doesn't have enough taxes taken out of his check and then we have to pay in to state and federal based on his not having enough taken out of checks over the course of the year? Gross earnings from my business were only 15,000 from my business (though actually ended up at a loss) though my husband's earning were much greater. Would I pay taxes during the year incorporating both his taxes and mine from the business to avoid a penalty? I wouldn't have any money left each month from the business earning then. I'm so confused. Please see the next paragraph, does the next paragraph make sense?
Or do you mean that I must pay adequate taxes from my business and as long as I do, all will be well. But if I don't, then there would be a penalty based on just the business underpayment during the year? I have no good idea what my business income will be as it is very variable. Is the line 16 amount the threshold I must meet if I wish to avoid any penalty for my business earnings underpayment? Maybe that's it! As long as I pay enough for my business taxes during the year, do I need to worry if my husband didn't take enough tax out during the year and has to pay in at the end of the year? Could you please expound on this for me?
The confused and tax know how distressed new business owner.
Thank
Thank you for your patience and time.
