quarterly taxes

[dsf_9d]

I always get paid from my employer on a w4 but me and my wife each did some self employment work on the side probably aroud 12,000. Will we be fined for not paying quarterly taxes? Should we pay now? Is April when we file OK?

[Carl]

W-4? I think you meant to type W-2.

Yes, you will pay taxes on that SE income, and since it was more than $400 you will also pay the additional 15.3% self-employment tax too. The SE tax is basically the employer side of your social security and Medicare.  I would suggest you send the IRS about 20% of your SE earnings "right now" so you don't have to waste your time dealing with applying for exceptions to late fees, underpayment penalties and all that stuff. So with $12K of SE income if you send the IRS $2,400 *right now* then come tax filing time you should be fine. You can pay online at www.irs.gov/payments.

Also, since "me and my wife" did some SE work, you will each be completing your own physically separate SCH C to be included with  your 1040 joint tax return. PAY ATTENTION to detail. If you will NOT be doing this same type of business in 2019, then not only will you each indicate you opened your business in 2018, you will also indicate that you closed it in the same tax year. Otherwise, (and it depends on the type of business) the IRS will be expecting a SCH C from you the next tax year and will notice it, if you don't send them one.

[dsf_9d]

Thank you. So basically I shud make estimated payment for me and for my wife to both IRS and NYS now? 2 separate ones? Also if next year I dont get any 1099 income what do I do (in regards to the last part you said)

[dsf_9d]

Basically for my payment now is it ok if one of us just lays the 2400 or do we need to make 2 separate ones so we both dint get fines or since one joint return it wont make difference?

[Carl]

If you will be filing a joint return then it doesn't matter if you each make separate estimated payments or not, really. But for book keeping purposes I would make separate payments. One under your SSN and the other under your spouse's SSN.

Also if next year I dont get any 1099 income what do I do (in regards to the last part you said)

Basically, you *read the screen* so that you make the necessary selection to indicate that you closed, sold or otherwise disposed of the business in the tax year.

So many times I see questions posted that are clearly answered by the program on the screen the poster is looking at, at the time they ask/post their question. The small print matters. Believe me, the programmers did not get bored and decide to just add text to the program just to pass the time. If the words are on the screen, they are there for a reason and they matter to somebody. You'll also find the information on some screens is highlighted in blue to indicate it's a clickable link that will provide additional details about that item. Others have a blue clickable "Learn More" link next to them, that provide additional information.

[dsf_9d]

Just payed my estimated tax on IRS site & by mistake put in wrong routing number (used Wire Routing not Electronic). Will IRS fine me for payment not going through? Should i wait to see if hear from them or pay again now?

[Carl]

Assuming you paid under your SSN, wait three business days. Then log onto your IRS account, check the payment history and see if it went through. I would figure three days should be sufficient for a wire transfer and so long as you have the funds available to pay it, I would fully expect it to go through.

If for whatever reason it did not go through I don't know if there's a failed transaction fee or not. But if there is, it's not more than $25. (I myself got a $25 fee for a payment that failed because of insufficient funds in the account, a few years back.)

[dsf_9d]

Awesome! I dont see the transaction on my bank account yet but hope your right. (Irs direct pay look up still shows Payment Status: Originated) and does go through despite giving the wire routing. I appreciate your responses. Thank you!

[dsf_9d]

Ok so wednesday I did this. Nothing yet. Should I just do it again. Or Thanksgiving and weekend not enough time? I dont see anything in my bank of a withdrawl

[Carl]

I've had transactions take as long as three business days to clear. So if you did this on Wednesday before thanksgiving, don't even count that day. If you're lucky, you might see it after your bank does their nightly balance after close of business on Wednesday.

[DebL1]

Why do I need to pay quarterly takes for 2020. My income did increase for 2019 but for this year it will less, as I retired.

[xmasbaby0]

@DebL1 Are you asking that  because you  have those 1040ES vouchers?  if you do not expect to owe at least $1000 at tax time next year, you do not have to use those.  They are optional.  They can be a good idea if you expect to owe, so that you do not get an underpayment penalty for the next tax return.  But you can toss them out if you choose not to use them.