Although the income tax filing deadline was extended until May 17, 2021, quarterly estimated tax payments for self-employed business owners are still due on April 15, 2021.
Tax law requires us to pay taxes throughout the year in a timely manner either through our W-2 or via estimated taxes. As an employee, taxes are automatically withheld from weekly or bi-weekly paychecks, but as a self-employed taxpayer, you’re on the hook for paying as you go.
Did you recently start a new business or become a consultant or freelancer in the past year? If you anticipate making over a few thousand dollars, we can help you figure out what you may owe and put together a projection for you to forecast future estimated tax payments.
Income that may be subject to estimated tax payments includes:
- Self-employment
- Interest
- Dividends
- Alimony
- Rental Property
Paying estimated taxes will help you avoid having to come up with a lump sum of money at tax time, and it will also prevent any unnecessary interest and penalties accrued for late payments.
Quarterly estimated tax payments are due four times a year. For the 2021 tax year, they are due April 15, June 15, and September 15. The 4th quarter payment is due on January 18, 2022 for the final 2021 estimated payment.
To pay, you have the option of e-filing your quarterly tax payment either through QuickBooks Self-Employed or the Electronic Federal Tax Payment System (EFTPS). You can also mail your payment to the IRS (check out the state-by-state guide for a specific mailing address), but be sure that your payment is postmarked by the deadline or you may be subject to penalty.
We’re here to help you calculate your estimated taxes so that you’re not overpaying or underpaying what you owe. Email Stu at stu@erocktax.com to get your first quarter estimated taxes in order.
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About Stu: With more than 30 years of experience as a tax professional, Stu Steinberg brings a broad depth of knowledge to his work with his clients. Stu founded Erock Tax to help provide tax and financial planning strategies to individuals, families and small businesses and is passionate about empowering his clients through education about their money health. Stu is highly energetic and brings a sense of optimism, creative problem-solving and a deep level of commitment to every Erock client.