KEY POINTS
When are 2023 Q3 estimated taxes due for self-employed individuals?
How do I pay my Q3 2023 quarterly taxes?
What happens if I miss my Q3 2023 tax payment?
WHEN ARE Q3 ESTIMATED TAXES DUE?
If you have not done so, now is the time to review your current tax situation and make your quarterly estimated tax payment. You should use IRS Form 1040-ES. The due date is rapidly coming around the corner, it is Friday, Sept. 15, 2023.
HOW DO I PAY MY QUARTERLY TAXES?
To pay Q3 estimated taxes, go to the IRS Direct Pay website. Using your checking account, savings account, or a credit/debit card, follow the instructions to pay through the Electronic Federal Tax Payment System (EFTPS).
Note: You can choose a more flexible option to fit your needs. You may elect to pay weekly, bi-weekly, or monthly based on your cash flow, as long as you pay in enough by the end of the quarter. If you decide the paper route, you can mail in a check or money order for your estimated payments.
WHAT HAPPENS IF I MISS A TAX PAYMENT?
To avoid any underpayment penalties, make sure you have the proper tax withholding during the year. If you have both W2 Withholding and self-employment income, but currently don't have enough to pay your estimated taxes, you may be able to adjust your W2 withholding to make up the difference.
When filing your estimated tax payments, please remember, you are required to withhold at least 90 percent of your current tax obligation or 100 percent of last year’s obligation.* Taking a quick look at last year’s tax return and a projection of this year’s obligation can help you determine if a payment necessary.
Don't forget, you may also have state obligations. Except for a few states, you may be required to make estimated state tax payments. You should consider conducting a review of your state obligations to ensure you meet the quarterly estimated tax payment requirements.
Note: if your earnings are over $150,000 ($75,000 if you're married filing separately), you should pay 110 percent of last year’s tax obligation to be safe from an underpayment penalty. Self-employed individuals, should remember to account for the need to pay your Social Security and Medicare taxes. Creating and funding an account for this purpose can help you avoid the cash flow hit each when paying your quarterly estimated taxes.
If you're in need of help filing your quarterly taxes, feel free to connect with us. Our main goal is to help affluent families and small business owners reduce tax liability and advocate for financial wellness through proven tax strategies.
