When are 2023 Q2 estimated taxes due for self-employed individuals?
The tax system in the U.S. is "pay as you go," so estimated taxes are due on a quarterly basis. The expectation is that each taxpayer will pay their estimated income and self-employment taxes due for the most recently-completed calendar quarter.
The due date for the second quarter's taxes, covering the period of April 1 through May 31, 2023 is June 15, 2023.
How do I calculate my Q2 estimated taxes?
If you believe you owe quarterly estimated taxes, you can use IRS Form 1040-ES. You will need to calculate your estimated adjusted gross income for the year, your taxable income, estimated deductions, and credits in order to arrive at your estimated payment amount.
It can help to use your last tax return as a guide to help determine these numbers, adjusting your estimated income amount for the year based on current projections. In the event you estimate too high or too low, you can adjust the calculations and quarterly remittance for the third quarter to compensate.
Is there tax relief for victims of 2023 winter storms?
Individuals impacted by severe winter storms, flooding, landslides and mudslides in California and other parts of the country have until October 16, 2023 to make certain estimated tax payments. Q2 2023 estimated tax payments for qualifying individuals are not due until October 16, 2023. The IRS maintains a state-by-state list where you can learn more about the available tax relief, and whether you live in an area that qualifies.
What are the different ways I can pay my quarterly taxes?
There are several ways you can remit your second quarter estimated tax payment. First, you can print and mail your 1040-ES form with a check. If you would rather pay online, you can do so using your bank account or with a credit or debit card (fees may apply). Another option is to pay using your phone or tablet using the IRS2Go app.
You could also use the IRS Electronic Federal Tax Payment System (EFTPS) to make federal tax deposits, installment agreement payments (if applicable), and quarterly estimated tax payments. In fact, you can use the EFTPS system to pay your estimated taxes more frequently than quarterly, making payments on a weekly, bi-weekly, monthly, or other periodic basis which may help some taxpayers with budgeting.
What happens if I do not pay my Q2 estimated taxes?
It may be tempting to put off paying your quarterly estimated taxes, thinking you will simply pay all of your taxes when you file your 2023 tax return next year. This, however, could be a costly mistake. If you do not pay enough throughout the year, through tax withholding from an employer's wages or estimated tax payments directly to the IRS, you could be subject to underpayment penalties.
If, after factoring in taxes withheld and estimated payments, you owe less than $1,000 when filing your 2023 tax return or if the amount you paid was at least 90% of the taxes you owe for 2023 or 100% of the taxes owed for 2022, you will generally not face an underpayment penalty. Other limited exceptions may apply, including penalty waivers related to casualty losses, disasters, or other unusual circumstances that make the penalty inequitable, or if the underpayment was due to your retirement or disability and not willful neglect.
Plan ahead to meet your quarterly estimated payment obligations
Small business taxes can be confusing. Your state and local tax authorities may also require quarterly estimated payments, although the deadlines and methodology may differ from federal requirements. It is important to understand your obligations so you can be proactive about meeting them.
If you need assistance calculating your estimated tax liability or have questions, ask a lawyer for help today. If you need tax help, Rocket Lawyer can now match you with a tax pro for affordable and convenient tax filing services. Don't do your taxes™ – Let us do them for you.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.