Some taxpayers may need to make estimated tax payments

Some taxpayers earn income not subject to withholding. For small business owners and self-employed people this can mean making quarterly estimated tax payments.

Anyone in this situation 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.

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 include 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 2019 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:
o Form 1040-ES, Estimated Tax for Individuals
o Form 1120-W, Estimated Tax for Corporation
• Taxpayers have options for paying estimated taxes. These include:
o Direct Pay from a bank account.
o Paying by credit or debit card or the Electronic Federal Tax Payment System.
o Mailing a check or money order to the IRS.
o Paying cash at a retail partner.

Taxpayers who don’t pay enough tax throughout the year may have to pay an underpayment penalty.

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NATP
National Association of Tax Professionals