If taxes are not withheld from all of your income, you may need to make estimated tax payments during the year. This often applies to self-employed people, investors, landlords and some retirees.

Who generally needs to pay

You may need to make payments if you expect to owe at least $1,000 after subtracting your withholding and credits. Corporations generally need to pay if they expect to owe $500 or more.

When payments are due

Payments are generally due on:

• April 15
• June 15
• September 15
• January 15 of the following year

If a date falls on a weekend or holiday, the due date moves to the next business day.

How much to pay

You can avoid the federal underpayment penalty in many cases by paying enough to meet safe harbor rules, generally 90% of this year's tax or 100% of last year's tax. Higher-income taxpayers may need to pay 110% of last year's tax.

If your income is uneven

If you earn most of your money in one season, there may be another way to calculate your payments. Ask your CPA about it.

Tips

• Set aside a percentage of each payment you receive
• Use a separate savings account
• Pay online through IRS Direct Pay or your IRS account
• Review your numbers if your income changes

Have questions about your situation? Tax rules change and every situation is different, so please talk with a professional before acting on general information. Call Fajardo & Associates at 407-720-7220 to make an appointment.