September Quarterly Taxes
If you are self-employed or own your own business, or otherwise have to pay over $1000 in taxes each year after subtracting any tax withholding and credits, there’s a deadline coming up that you need to be aware of. September 15th is the deadline to file your 3rd quarter taxes with the federal government. Paying your quarterly taxes on time is crucial to avoid interest and penalties on your tax bill. If you’re new to paying quarterly taxes, here is what you need to know.
Quarterly tax payments are technically estimated tax payments. They are payments you pay in advance to cover your tax liabilities. They are due April, June, September, and January on the 15th, one payment per quarter. Along with these estimated payments, you also have to file your standard taxes by the usual deadlines. You’ll add in the information about your payments over the year to your tax return when you’re calculating how much you owe. If you pay your quarterly tax payments on time and in the right amount, you’ll often have to pay very little tax and could even get a refund.
Paying your estimated taxes is easy. If you want to do it by mail, you can mail form 1040-ES along with the payment. You can also do it over the phone. However, estimating how much tax you need to pay can be complicated. While you can get your money back if you overpay, it takes a time to get it back. If you underpay, you’ll be liable for penalties. That’s why many business owners prefer to hire a tax attorney or a CPA experienced in business taxes to handle their estimated payments.
What happens if you underpay?
In the most general terms, you’ll be charged a 3% interest rate on the amount of tax you still owe. This may not seem like much, but it does add up. Also, it puts you on the IRS radar as someone who doesn’t pay taxes like they should. If you haven’t gotten into the habit of paying quarterly taxes yet, it’s better to do it sooner rather than later. Even a smaller payment in the middle of the year can knock down the amount of underpayment penalty and will show the IRS that you’re at least making an attempt to pay your taxes.
There are also many additional factors that go into deciding what your tax penalty will be. For instance, if you work in the fishing industry or you’ve earned capital gains, your rules will be different. Spending an hour or two with a tax attorney to get a clear idea of your quarterly tax obligations is time well spent.
If you live in South Florida and you need help deciding whether or not you need to pay quarterly estimated tax payments, figuring the amount you need to pay, or help you do it on your behalf, call the Ft. Lauderdale tax attorneys at Zuckerman Law. We’ve been helping people in Miami, Ft. Lauderdale and all points in-between with their tax issues for decades. If you haven’t been paying your quarterly taxes, it’s time to start.