Quarterly Estimates

How do I know if I have to file quarterly federal individual estimated tax payments? 

Estimated tax payments can be used to pay Federal income tax, self-employment tax, and household employment tax. To estimate if you need to pay tax on income not subject to withholding or on other income from which not enough tax is withheld, you need to calculate if the total tax you'll owe on your annual income tax return will be covered by the amount of tax you have already had either:

  • withheld from wages and other payments, or 
  • paid in earlier estimated payments for the year, or
  • credited to your account from adjustments or overpayments to previously filed returns. 

Generally, you should make estimated tax payments if you will owe tax of $1,000 or more, after withholding and credits, and the total amount of tax withheld and your credits will be less than the smaller of:

  • 90% of the tax to be shown on your current tax return, or 
  • 100% of the tax shown on your prior year's tax return, if your prior year's tax return covered all 12 months of the year. However, if your prior year's adjusted gross income exceeded $150,000 or $75,000 if you filed a separate return from your spouse, then you must pay 110% instead of 100% of last year's tax. (Note: the percentages change depending on the tax year. Refer to Publication 505 (PDF), Tax Withholding and Estimated Tax.) 

Estimated tax requirements are different for farmers and fishermen. Publication 505 (PDF), Tax Withholding and Estimated Tax, provides more information about these special estimated tax rules and about estimated tax in general. Get Form 1040ES (PDF), Estimated Tax for Individuals, to help you figure your estimated tax liability.

Are all the quarterly estimated tax payments the same amount? 

Normally, you determine your tax at the first of the year and divide by 4 but this can change as your income may change for a certain quarter. If your income fluctuates during the year, you should complete the 2011 Annualized Estimated Tax Worksheet in Publication 505 (PDF), Tax Withholding and Estimated Tax. The worksheet annualizes your tax at the end of each period based on a reasonable estimate of your income, deductions, and other items relating to events that occurred since the beginning of the tax year through the end of the period. Use the result you figure to make your estimated tax payments and complete your payment-vouchers. 

Do self-employment taxes need to be paid quarterly or yearly? 

Self-employment tax is paid by making quarterly federal estimated tax payments which include both income tax and social security tax. 

What form will I use to make federal estimated payments? 

Use Form 1040ES (PDF), Estimated Tax for Individuals, to estimate your tax liability. Four payment vouchers are included in the 1040ES package that are used to send your payment to the Internal Revenue Service. 

When are the quarterly federal estimated tax returns due?

Your first estimated tax payment is usually due the 15th of April. You may pay the entire year's estimated tax at that time, or you may pay your estimated tax in four payments. The four payments are due April 15th, June 15th, September 15, and January 15th of the following year.

If the due date for making an estimated tax payment falls on a Saturday, Sunday, or legal holiday, the payment will be on time if you make it on the next day that is not a Saturday, Sunday, or legal holiday. For example, a payment due Sunday, April 15, 2007, will be on time if you make it by Monday, April 16, 2007.

Can I make my quarterly federal individual estimated tax payments by credit card? 

You can generally pay part or all of your estimated tax by using a credit card (American Express Card®, DiscoverCard®, MasterCard®, or Visa® card). Payments can be made by phone or Internet. There are two credit card processors (also referred to as service providers), which offer this service. Service providers charge you a convenience fee for the service. 

Do I have to pay my resident state quarterly individual estimated tax payments?

If you have to pay federal estimates, then most likely you will also have to pay state quarterly estimates as well.