IRS Tax Tip 2020-115, September 8, 2020 Some taxpayers earn income not subject to withholding. For small business owners and self-employed people this can mean making quarterly estimated tax payments. Here are some important things taxpayers should know about estimated tax payments: Taxpayers generally must make estimated tax payments if they expect to owe $1,000 or more when they file their 2020 tax return. Aside from business owners and self-employed individuals, people who might also need to make estimated payments includes sole proprietors, partners and S corporation shareholders. It also often includes people involved in the sharing economy. Estimated tax requirements are different for farmers and fishermen. Corporations generally must make these payments if they expect to owe $500 or more on their 2020 tax return. The remaining deadlines for paying 2020 estimated taxes are September 15, 2020 and January 15, 2021. Taxpayers can review these forms for help figuring their estimated payments: Form 1040-ES, Estimated Tax for Individuals Form 1120-W, Estimated Tax for Corporations Taxpayers have options for paying estimated taxes. These include: Direct Pay from a bank account. Paying by credit or debit card or the Electronic Federal Tax Payment System. Mailing a check or money order to the IRS. Paying cash at a retail partner. Taxpayers who don't pay enough tax throughout the year may have to pay an underpayment penalty. Taxpayers, who have a job or a pension with federal tax withholding should check their withholding using the Tax Withholding Estimator on IRS.gov. If the estimator suggests a change, the taxpayer can submit a new Form W-4 to their employer. The estimator handles multiple sources of income and multiple jobs provided the taxpayer has a W-2 income or a pension/annuity statement. More information: Publication 505, Tax Withholding and Estimated Tax Subscribe to IRS Tax Tips
