We haven't paid the first two quarterly payments for this year 2024. It's all new to us so what should we do at this point. Pay the first two now or wait and pay the 3 payment when it's due. Also, what about penalities?
Thank you.
So quarterly payments are due on April 15, June 15, September 15 and January 15 of the following year, unless the 15th falls on a weekend or a Federal holiday. In that case the payment is due the next business day.
So despite missing the first two quarterly payments, you want to pay the third and fourth payments prior to or on the date it is due. There is no real incentive to making the third quarter payment early, though for planning purposes it is probably easier to make it sooner. The third quarter payment should include the first and the second quarter payments as well.
The penalty itself is interest on the underpayment amount. Generally, most taxpayers will avoid this penalty if they either owe less than $1,000 in tax after subtracting their withholding and refundable credits, or if they paid withholding and estimated tax of at least 90% of the tax for the current year or 100% of the tax shown on the return for the prior year, whichever is smaller.
Thanks again for the question @mitzilou107
All the best,
Marc
Employee Tax Expert