ES 1040 payments

[Cfl1040]

2021 ES1040 payments for V1+V2+V3 already exceed my tax liability for 2021. Is it necessary to pay V4?

[fanfare]

" Is it necessary to pay V4?"

No. Isn't this obvious ?

[fanfare]

If you didn't pay in at least as much as your total tax last year (110% for certain high income taxpayers), you could be in trouble.

[Critter-3]

If you have satisfied the amount needed to avoid a penalty then the 4th quarter payment is not needed ...

The following is the general rule:

You must pay estimated tax for 2021 if both of the following apply.

• You expect to owe at least $1,000 in tax for 2021 after subtracting your withholding and tax credits.
• You expect your withholding and tax credits to be less than the smaller of:                                                                A)  90% of the tax to be shown on your 2021 tax return, or                                                                                    B) 100% of the tax shown on your 2020 tax return. Your 2020 tax return must cover all 12 months.

Note: If your AGI for 2020 was more than $150,000 ($75,000 if your filing status for 2021 is married filing a separate return), substitute 110% for 100% in (2b)

[Cfl1040]

With a sharp decrease in AGI in 2021, the first three ES 1040 payments this year, which were  based on taxes paid in 2020 , are more than double my 2021 tax liability. I cannot imagine that I would be subject to any penalties.  It's logical not to send another payment (V4) but it is unsettling nonetheless.