Estimated Tax Payment

[a_f]

Due to some miscalculation, I under-calculated my estimated tax. Now, I realize my withheld tax probably won't be enough to cover 110% of last year's tax. Can I make a payment now to hit 110% mark and avoid under-payment penalty? I never had such penalty in the past.

Thanks,

[DoninGA · Accepted solution]

Go to this IRS payment website to pay estimated taxes for tax year 2024 - https://www.irs.gov/payments

A 2024 estimated tax payment can be made at any time on or before 01/15/2025

[dmertz · Accepted solution]

DoninGA didn't actually answer the question.  An estimated tax payment made now (for Q4) will not correct any underpayment for Q1 through Q3 (although it can limit the continued accrual of penalty and interest for Q1 through Q3 from the payment date forward).  At this point, correcting for underpayment in Q1 through Q3 can only be done via tax withholding, 1/4 of which would be applied to each of the tax quarters, not by estimated tax payment.  Unlike tax withholding, estimated tax payments are only credited when actually paid.

If the largest portion of your income occurred in Q4, annualizing income on Schedule AI of Form 2210 will reduce or eliminate the underpayment for earlier quarters.  Otherwise, income and tax withholding are treated by default as having been received and paid evenly throughout the year.