What are estimated taxes?
They are quarterly tax payments made to the IRS for income you received that wasn’t subject to federal tax withholding.
Common situations that require estimated tax payments:
- You’re self-employed.
- You receive significant income from non-wage sources.
By making quarterly estimated tax payments, you can avoid an underpayment penalty and also owing a large amount of tax when you file your return.
If you’re at risk for an underpayment penalty next year, we'll automatically calculate your estimated tax payments and prepare 1040-ES vouchers that include the payment due date.