Quarterly payments vs. adjusted witholding?

Taxes General Forum - Tax professionals meeting place and answers to queries. (Moderated) 

Yahoo!   Google   Windows Live   del.icio.us   digg   Netscape

Subject Author Date Quarterly payments vs. adjusted witholding? Bert Hyman 03-12-2007  Re: Quarterly payments vs. adjusted witholding? Phil Marti 03-13-2007  Re: Quarterly payments vs. adjusted witholding? Barry Margolin 03-13-2007  Re: Quarterly payments vs. adjusted witholding? Paul Thomas, CPA 03-14-2007  Re: Quarterly payments vs. adjusted witholding? ed 03-14-2007  Re: Quarterly payments vs. adjusted witholding? Shyster1040 03-14-2007
Posted by Bert Hyman on March 12, 2007, 8:54 pm Please log in for more thread options I had some unavoidable capital gains this year, and I'm likely to have the same for the next few years. This year's caught me a bit by surprise and I knew I'd be owing additional taxes, so I'd planned on adjusting my withholding to avoid future penalties. But, after cranking it through TurboTax, it tells me to make quarterly payments, the sum of which pretty much match what I'd planned on having withheld. Does the IRS care if it gets the money via withholding or quarterly payments, so long as it gets it? I really don't mind sitting down four times a year and writing a check, if I know I'm really going to owe the money come April. -- Bert Hyman | St. Paul, MN | bert@iphouse.com << ======================================================= >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2006) - All rights reserved. >> << ======================================================= >> Posted by Phil Marti on March 13, 2007, 6:45 pm Please log in for more thread options > I had some unavoidable capital gains this year, and I'm > likely to have the same for the next few years. I can think of any number of problems I'd happily trade you for. <g> > This year's > caught me a bit by surprise and I knew I'd be owing > additional taxes, so I'd planned on adjusting my withholding > to avoid future penalties. > > But, after cranking it through TurboTax, it tells me to make > quarterly payments, the sum of which pretty much match what > I'd planned on having withheld. > > Does the IRS care if it gets the money via withholding or > quarterly payments, so long as it gets it? No. If you care about what TT thinks, tell it about the increased withholding and it won't bug you about ES payments, but I wouldn't bother. Just do what you were planning on doing. -- Phil Marti Clarksburg, MD << ======================================================= >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2006) - All rights reserved. >> << ======================================================= >> Posted by Barry Margolin on March 13, 2007, 6:45 pm Please log in for more thread options > Does the IRS care if it gets the money via withholding or > quarterly payments, so long as it gets it? No. I've always preferred adjusting withholding, as I can set it and forget it. Another inconvenience of quarterly payments is that the IRS expects you to pay in each quarter for the excess income of that quarter. But if you use extra withholding they don't care which quarter the extra income was earned. Finally, don't forget to take advantage of the "safe harbor" rule. There's no underwithholding penalty if your withholding for year N is at least your total tax for year N-1 or 90% of your tax for year N. So if you think your income is going to go up, all you have to do is arrange for your withholding to match your previous year's tax, you don't have to estimate the actual extra income. -- Barry Margolin, barmar@alum.mit.edu Arlington, MA *** PLEASE don't copy me on replies, I'll read them in the group *** << ======================================================= >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2006) - All rights reserved. >> << ======================================================= >> Posted by Paul Thomas, CPA on March 14, 2007, 12:22 am Please log in for more thread options > I had some unavoidable capital gains this year, and I'm > likely to have the same for the next few years. This year's > caught me a bit by surprise and I knew I'd be owing > additional taxes, so I'd planned on adjusting my withholding > to avoid future penalties. > > But, after cranking it through TurboTax, it tells me to make > quarterly payments, the sum of which pretty much match what > I'd planned on having withheld. > > Does the IRS care if it gets the money via withholding or > quarterly payments, so long as it gets it? Either way is fine, as long as enough is withheld or paid by estimates. -- Paul Thomas, CPA paulthomascpapc@bellsouth.net << ======================================================= >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2006) - All rights reserved. >> << ======================================================= >> Posted by ed on March 14, 2007, 12:22 am Please log in for more thread options > I had some unavoidable capital gains this year, and I'm > likely to have the same for the next few years. This year's > caught me a bit by surprise and I knew I'd be owing > additional taxes, so I'd planned on adjusting my withholding > to avoid future penalties. > > But, after cranking it through TurboTax, it tells me to make > quarterly payments, the sum of which pretty much match what > I'd planned on having withheld. > > Does the IRS care if it gets the money via withholding or > quarterly payments, so long as it gets it? ... Because Withholding is applied equally to all tax quarters, whereas Installment, or Estimate, payments can not be applied retroactively, you are always safer to pay withholding than installments. ed << ======================================================= >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2006) - All rights reserved. >> << ======================================================= >> Similar Threads Posted Quarterly estimated tax payments for married couple March 23, 2007, 6:31 am How do I determine my adjusted basis upon buy-out of a partnership? April 16, 2009, 5:14 pm How to calculate modified adjusted gross income March 1, 2007, 7:06 am Inflation Adjusted Items for 2010 Released By IRS October 15, 2009, 3:09 pm Madoff Clients, Income Tax Paid, and Filing of Adjusted Return December 16, 2008, 1:39 pm How to report quarterly estimated FIT paid? April 13, 2007, 11:29 pm Which Form to Pay Quarterly Taxes for my Incorp'd Business? May 8, 2007, 1:12 am 1099 witholding March 11, 2009, 5:10 pm Alien non-resident needs help with 30% witholding May 5, 2007, 6:17 am Overpaid state witholding -- strategy? December 30, 2006, 2:48 pm