kind of late. estimated taxes were due 4/15/19, 6/15/19, 9/15/19. the next one is due 1/15/2020. in theory 1/4 of your total estimated tax was supposed to be paid each quarter to avoid penalty. however there are safe harbors where you wouldn't need to pay estimated taxes even though at tax time you could owe 10's of thousands of $ , the rule to avoid penalty in 2019 is for your withholding and timely estimated tax payments to be 100% of your 2018 tax. (110% of your 2018 tax if your 2018 adjusted gross income is $150,000 or more).
if you are subject to penalties, the annualized installment method for calculating penalties might help. this is best for situations when your income is earned unevenly throughout the year and there's a huge bump later in the year. it will nor help if more of your income was earned in the early part of the year.
for 2020, if you expect around the same amount of income as 2019, your choices are either to increase withholding or pay estimated taxes. estimated taxes are better because it allows you to hold on to your money longer. however, some taxpayers spend every nickle in their pocket. if you are one of these then withholding would be the way to go.
... View more
Sign In
