Estimated Tax Payments

[LB641]

For 2023, we had a one time, lump sum, payment from an annuity. 

As this is a one time event, the estimated tax vouchers for next year will be more than we need to pay for the following year.

However, to stay ahead of increased income from 1099-INT, how do we determine the proper amount, and do we get a receipt / proof of payment if we make estimated tax payments?

Is it also true that the estimated tax vouchers and payments are not required, and we can elect not to use them, with the understanding that a fine for underpayment may result. 

Paying a $200 fine for underpayment, verses keeping the money in a bank/credit union at 5%, is worth considering.

[KrisD15]

Yes, it is true that Estimated Payments are suggested and not required to be made. 

You can estimate your tax bracket, for example say your in the 22% tax bracket, then make estimated payments based on that percentage. 

No, there is no receipt sent. Pay with a credit card or check so you have proof of payment.

You can setup an account on the IRS "Your Online Account" to view payments made. 

[LB641]

TurboTax pre-fills the estimated tax vouchers with an amount. And a date.

Can we send in a different amount? If so, how using that voucher? Or create a new voucher.

And are the dates hard dates. Can funds be sent in on, before, or after the voucher dates?

Thanks

[VolvoGirl]

Yes to all.  You can cross out the amount and write in a new amount.  Or just pay directly online on the IRS website https://www.irs.gov/payments

Be sure to pick the right kind of payment and year.....2024  Estimate

Yes you can pay at different times but if you pay one late you can end up owing a penalty on your tax return next year.