I'm W2. My wife is also w2 but has started working 1099 this year at a job that will push our tax bill several thousand dollars higher than last year. Previously my withholding was enough to cover both of us married filing jointly. I could adjust my withholding or just prepay some taxes. Preferred option is to prepay taxes and not have the IRS think I've missed the April 15th estimated tax filing deadline (which I'm afraid of if I use the 1040ES)
1) Want to confirm we are not subject to estimated taxes because we are paying via my deductions.
2) What is the best way to just make an early tax payment to the IRS? All the online tools seem to make me pick the 1040 ES but will that look like I've missed the April 15th deadline?
You'll need to sign in or create an account to connect with an expert.
You should pay in quarterly estimated taxes (or increase your withholding) if both of the following apply:
- 1. You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits.
- 2. You expect your withholding and credits to be less than the smaller of: 90% of the tax to be shown on your current year’s tax return, or 100% of the tax shown on your prior year’s tax return. (110% for higher income people; $150K)
If your goal is just to avoid the underpayment penalty, then paying 100% of the prior year tax liability is the “safe haven”
Q. Want to confirm we are not subject to estimated taxes because we are paying via my deductions.
A. Yes.
Q. What is the best way to just make an early tax payment to the IRS? Using1040 ES makes it look like I've missed the April 15th deadline?
A. Increased withholding or make quarterly payments are the only two options (or some of each). You did miss the April 15 deadline. But quarterly deadlines only apply to 1040-ES estimates, not to increasing your withholding at your job. Withholding is treated as spread out over the whole year. In an extreme example; you could have one big withholding taken out of your December pay and meet the rule (but doing that might annoy your employer).
If you go the quarterly estimates route, the estimated payments do not have to be equal if her 1099 income is irregular. For example if she had little or no income in the first quarter, an April 15 payment was not required. Again, in an extreme example, if all her income came in the 4th quarter, then only the fourth quarter payment is required. If you do use irregular quarterly payments, filing form 2210 will, most likely, be required.
Hal_AI is spot on, couldn't be explained better
You can easily make payments online by setting up account at www.eftps.gov
You can setup payment to be made on a future date, very convenient
I setup upcoming year's 4 estimated payments when I file and make note in Quicken to remind me to have $ in checking account.
Thanks for the quick response but I'm still a bit confused. On one hand, you are confirming we are not subject to estimated taxes because we are married filing jointly and taxes are being paid via my W2. On the other hand, you are saying we should pay them and missed the filing deadline. I guess I'm trying to differentiate between "should" and "must". So if I just use the online payment tools the IRS offers, pick "estimated taxes" as the reason (I've look at all them and I don't see a "just feel like paying early" option), and send them a few thousand bucks, will the IRS know I've already been paying taxes and am prepaying 2021 vs the estimated tax for which I missed the deadline? I know, I'm trying to be super specific here.
OK.I'm rereading the first response again.. So if file the 1040 ES the IRS will think I missed the q1 payment and hit me with penalties. If I increase my withholding, IRS won't care.. Is that the bottom line? And of course I can adjust my withholding for just a pay period or two.
It also depends on when you earned the income. If you get hit with a penalty when you file 2021 next year you might be able to eliminate it or at least reduce it. You can go to Federal Taxes tab or Personal tab, under Other Tax Situations and select Start by the Underpayment Penalties. You will answer a series of questions that may reduce or eliminate the penalty. Or you can elect to have the IRS figure the penalty for you. It's form 2210.
Q. If I increase my withholding, IRS won't care.. Is that the bottom line?
A. Yes.
What about State? I'm in VA.
Same rules apply. Just increase you state withholding.
Taxes taken from W-2 earnings are considered paid timely. If you only pay estimated tax you must meet quarterly deadlines. If you & spouse are W-2 & 1099 you can withhold all taxes from W-2 and pay $0 estimated as long as you meet the criteria for no penalty in Hal_IA's 1st posted.
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
sanfran2121
New Member
Excelmiddle
New Member
Superholez50
Returning Member
SLP01
New Member
MarkF6
Returning Member
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.