I made one time long term stocks capital gain on Feb 2018. The gain amounts to few times the annual wage. Based on the wage income and tax bracket, I'd have to pay 20% of the gain taxes.
Do I have to pay 20% of the gain taxes on Apr 2018 (along with 2017 taxes) or do I have to make 4 quarterly payments each quarter of one 4-th of the 20% gain, until Apr 2019?
If I need to borrow the gain taxes, let's say 4.5%/year, the interest may be larger than the 3%/year penalty that I'll have to pay to IRS in Apr 2019.
How do you suggest paying the capital gain taxes?
You are not forced to make estimated tax payments - you are definitely not forced to pay all of the estimated taxes in April.
As we are required to pay taxes as we receive the income, I would highly recommend that you pay four quarterly estimated payments, paying as much as you can towards the estimated tax you will be paying on the capital gain. Any amount you pay will lessen penalties when you file your 2018 income tax return.
Click here for further information about Estimated Taxes.
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