Self Employment Pay Tax Question

[KaN12]

Hello, first time being self employed. I want to pay tax ahead of time (for 2022) at irs website. My questions are: 1.by the end of the year, how to I prove or input that I paid such an amount if I use turbotax software?

2. Do I need to file any tax document quarterly when I am paying the tax online? Or can I just submit the payment? 
Thank you. 

[Mike9241]

you can not use Turbotax to make estimated tax payments. all it can do is print vouchers for you to mail in with a check.

on the other hand, you can use the IRS website to make tax payments without the need to mail anything in

if you have employees their payroll taxes must be deposited using the EFTPS which you can also use to make your personal estimated tax payments

even with employees, you have the option to make estimated tax payments for yourself using Direct Pay or Credit Card/Digital Wallet option 

after you submit the payment request, you'll be able to print a receipt that will have tracing info should the IRS ever question the payment.

https://www.irs.gov/payments 

if you have state income taxes your state probably has a website to make an electronic payment. again at the end, a receipt can be printed 

if you had a tax liability for 2021 you can not wait until filing time to pay the taxes you owe. 

here are the federal rules for estimated tax payments to avoid penalties

There will be no federal penalties for not paying in enough taxes during the year if withholding

1) and timely estimated tax payments equal or exceed 90% of your 2022 tax or

2) and timely estimated tax payments equal or exceed 100% of your 2021 tax (110% if your 2021 adjusted gross income was more than $150K) or

3) the balance due after subtracting taxes withheld from 90% of your 2022 tax is less than $1,000 or

4) your total taxes are less than $1,000

the lower of 1 or 2 is your required annual payment.  under the simplified method for estimated tax penalties, 25% of this amount must be paid in by 4/18, 50% by 6/15, 75% by 9/15 and 100% by year-end.

failing this and being subject to penalties you can use the annualized installment income method. 

this method requires knowing your income and deductions thru 3/31, then 5/31, then 8/31, and finally tear end which should be the same as the tax return. the income is annualized. taxes are computed on the annualized income and then de- annualized. your tax payments for each period must equal or exceed these amounts to avoid penalties

form 2210 page 3

https://www.irs.gov/pub/irs-pdf/f2210.pdf   

state laws vary

[dmertz]

1.  In 2022 TurboTax, estimated federal income taxes that you paid (either online or by mail) and the dates that you paid them are to be entered under Deductions & Credits -> Estimates and Other Taxes Paid -> Estimates -> Federal estimated taxes for 2022 (Form 1040-ES).

2.  If you pay your federal estimated income taxes (Form 1040-ES) online via IRS Direct Pay, no paper Form 1040-ES is to be filed.  The IRS credits the online payment to your tax account (associated with your SSN) and when entered as indicated in (1) TurboTax will include the total on Form 1040 line 26.

[Carl]

1.by the end of the year, how to I prove or input that I paid such an amount if I use turbotax software?

First, you can't use TTX to pay quarterly taxes with. But you can most definitely pay them on line at www.irs.gov/payments. Upon making the payment (I can't stress this enough) *PRINT* *YOUR* *RECEIPT*. That is your "proof" you made the payment.

2. Do I need to file any tax document quarterly when I am paying the tax online? Or can I just submit the payment?

No. But as stated above, when you make your online payment *PRINT* *YOUR* *RECEIPT*.  When it comes to dealing with the IRS, if it's not in writing, then it did not occur. Period.

You'll be able to enter your quarterly payments in the TurboTax program while entering your data. You'll deal with that under the deductions and credits tab in the Estimates & Other Taxes Paid section of the program.

Note that if your state taxes personal income, you will need to pay your state quarterly taxes separately from your federal quarterly taxes. How you do that, depends on the specific state. So you'll need to check your state's department of revenue or department of taxation website for how and when quarterly state taxes are due.