Contrary to what you may think, estimates are not optional.
In fact, it is an IRS requirement that you pay as you earn.
If you are a W2 employee, taxes are withheld from each paycheck (and deposited by your employer), which satisfies this requirment.
However, if you are self-employed, it is your responsibility to set aside earnings and pay throughout the year. This is where quarterly estimates come into play. The quarterly estimates prepared for you based on your prior year’s tax return must be paid each quarter. Because they are Estimated, the actual amount you pay each quarter may vary; however, you are required to pay each quarter.
If you do not pay the required estimates, you may receive a letter from the IRS or state for failure to pay proper estimated taxes.
If we created vouchers for you, you must either send a check with the voucher or pay online (instructions are on the voucher).
To find your estimated payment vouchers, please log onto the portal (make sure you are in your Personal account. If you have a separate business return your accounts will be linked: click the name at the top right corner to toggle between accounts), then go to “Get a Copy of My Tax Return & Documents” to download the file type “ESTIMATES.”
(Note: if you’re late, you may need to change the tax year at the top. 2023 Estimates will be under 2022 as they were created based off your 2022 filing.)
Watch Paul’s short video (less than 2 minutes!) on the Estimated Tax Requirement here: https://youtu.be/ARTjK21FGVc
The video is also listed on the FAQ section of our website: https://smarttaxadvisor.com/general-faqs/