topic Occasional 1099 earnings in Self employed

Occasional 1099 earnings

Rideguy — Wed, 30 Aug 2023 19:46:56 GMT

Once or twice a year, at irregular intervals I receive 1099 income for consulting work. Do I need to file quarterly, or is there a way to make one-time additional withholding payments? Same question for both federal and California taxes.

Re: Occasional 1099 earnings

Gabriella_EA — Wed, 30 Aug 2023 19:54:01 GMT

Hello @Rideguy!

Thanks for your question. Having irregular 1099 consulting income can definitely present a little challenge in accurately estimating and pre-paying your taxes. While it is technically possible to make one-time (or at least brief) increases in your withholding from your employment income, in your situation, it's likely easier to do the quarterly estimated tax payments. You don't have to pay every quarter, just the quarters you have earnings. This IRS table is helpful for getting the timing right.

Since you can pay the IRS directly at IRS.gov (and it's a similar process for California), the process should be pretty painless for the two or so times a year you need to make those payments - likely much easier than trying to adjust your W-4 withholdings and then shift them back.

I hope that helps to answer your question, but if you need any follow-up advice or information, feel free to reply to the thread, and I'll respond to anything new you post!

Re: Occasional 1099 earnings

Esther M — Wed, 30 Aug 2023 20:19:42 GMT

Hi,

The rule about paying quarterly estimated taxes does not recognize the number of times in a year that you make money as a self-employed person. It simply says if you estimate that you're going to owe more than $1000 at the end of the year, them you should pay estimated taxes as follows:

January 1 to March 31 – April 15
April 1 to May 31 – June 15
June 1 to August 31 - September 15
September 1 to December 31 – January 15 of the following year

The payments does not have to be even, you can stagger them according to the schedule of your income. This applies to both the federal and California

The link below provides more information.

https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes

Estimated Taxes

I hope this answers your question.

rgds.