Quarterly Estimated Taxes - Why You SHOULDN'T Pay!
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- Опубліковано 17 жов 2024
- What are estimated quarterly taxes? Basically taxes that you estimate for the current year and pay throughout the current year each quarter.
Are there some scenarios where you shouldn’t pay those taxes? Possibly. Sometimes, it might be more valuable to you to save that money and pay your taxes off once you prepare your tax return the following year. Sometimes, it’s more valuable to have that cash in hand for longer.
#IRS #Estimatedtaxes
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This video is for entertainment purposes only. The information portrayed in this video should not be considered as tax or legal advice. Consult with your own tax professional and attorney to get proper advice for yourself.
Let me know your thoughts below. What are you doing for estimated taxes?
How do you make a video like this without saying what the penalty for not paying is?
a tip : watch movies on Flixzone. I've been using it for watching all kinds of movies recently.
@Aron Marcel Yup, been using flixzone for since november myself =)
Im looking for a cpa
Omg this video has given me so much relief. Thank you for this! First year working as contractor and taxes were stressing me out
Saaaame! Specially because tdy is the 1st quarter
Do you pay quarterly or just get small penalties?
Being self employed for 6 years and I've always paid annually. Until this year I saw quarterly message. My question is will I get penalties not doing quarterly and decided to do lump sum on April/annually?
Update, i just kept reading on my 1040. I don't have penalties. Instead is marked gray as to skip. 🤔. I just notice on the vouchers says "File only if your are making a payment of estimated tax" the word "if" is like an optional?
What's the point if you need to use it to pay taxes anyway? It's just as inaccessable in an emergency because you need to keep it. I'd rather pay it to save the 3-5%.
Thanks for the thoughtful advice. It's good to see a professional thinking outside the box.
Not paying quarterly taxes is like taking a very low interest loan. Just make sure you have it all at the end to pay it in one lump sum plus the small amount of penalty interest. With interest rates extremely low and Powell signalling they will be gunning for inflation then the real rate on this loan may end up being pretty close to zero the next 2-3 years. Good advice don't gamble it away but if you have a solid opportunity that requires capital in the short term then this is as good a loan as any (better in a lot of cases). As an extra bonus you don't have to spend the time dealing with paying estimated taxes 4 times a year. JUST MAKE SURE YOU HAVE IT WHEN THAT FINAL BILL IS DUE.
Yes, great point that I realized I didn't make strong enough in the video. THE GOAL IS TO STILL PAY OFF YOUR TAXES AFTER YOUR TAX RETURN IS COMPLETED.
"Just make sure you have it" kind of negates the idea of using it as a loan, don't you feel?
Well, How big is the late fee???
@@NguyenCPAs It wasn't crystal clear in the video. I just assumed because I knew still have to pay our taxes but you are saying put the quarterly tax in a saving to gain a little more income. But also have it because you never know when you are going to need it. Hence the "just make sure you have it when that final bill is due"
@@wouldyourathernation7588 I have searched several of these videos and no one addresses this. Curious.
If you pay to much in quarterly taxes do you get a refund? Is it better to pay to little or to much every quarter? This will be my first year paying them.
Thank you! I will put my estimated into a money market account. ☺️
So put profits into a high yield savings account. And file all at once end of year. Pay the fee with savings from high yield interest?
You can also jack up your W-2 withholding towards the end of the year to minimize that estimated tax underpayment penalty. Thanks for the video. Nice perspective.
Self employed individuals don't get a w2. It's a 1099. Your money isn't taxed. You have to pay taxes yourself quarterly or annually.
I put my tax money in a mutual fund last year that made a 20% return
I need this info. Thanks
What if it went down
@@dizzle.1983Maybe,less taxes.
Do single member LLC’s with no employees have to pay estimated federal quarterly taxes?
Very detailed information and explanation 👍
So do you file your taxes in April if you opt not to pay the quarterly?
if i hire a cpa, won’t they charge me to do my quarterly taxes? so i’ll have to pay my taxes and also pay for the help 😰😭
If I don't make quarterly payment but pay all at the end of the year, do I have to pay interest and penalty. Thank you.
If you pay by 4/15, there is no interest or late payment penalty. There will be an "estimated tax" penalty but it is much smaller than a late payment penalty or interest
That's what I was wondering to , I rather pay 1 time at the end of the year, if the penalty is only like $50or less , but if it's like $200-300
Then I will just pay quarterly to save that money
Would be helpful to know the amount of penalty
@@NguyenCPAs Just to clarify. Are you saying if I pay the entire tax by April 15 of 2022 for 2021 taxes, there is just an estimated tax penalty, or I need to pay the full amount by April 15 of 2021 for 2021 taxes?
@@brentmiller2256 Full amount by April 15
Thanks man! that's really helpful!
We have to pay CPA thousands to tell us how many morr thiusands we owe IRS. After doing my tax, why I feel my side hustle ended up not profit that much?! Im a sole proprietary file schedule C,
I absolutely agree if someone can calculate their estimated tax plus interest plus penalty and determine if the return on keeping the money in the business and keep generating more income outweighs the cost. Another way to look at it is if it costs you more than the penalty and interest to borrow the same amount of money as the estimated tax than not paying estimated tax and paying when the tax is due with its penalty and interests makes sense.
If someone has ONLY capital gains income and no ordinary income (salary/wages), does he/she still have to pay quarterly?
My mom only has SSA and capital gains income. How is she taxed on SSA and capital gains?
Yes, you are suppose to
If you owe $1000 or more you must.Found that out when I got a penalty this year.
This is my second year delivering for grubhub and doordash. Should I pay quarterly taxes?
how's that possible, you paid at the end of the first year right? unless your skipping taxes entirely which Is very not good.
Hi Ryan. Ive worked only odd jobs all last year. I'm not sure how I need to claim those. Do I need to name everyone & the amount they paid or just claim it as a whole & pay the taxes on it? Its only $14k & I have $ to pay all taxes , now. Thank you for your assistance. I appreciate you . 😊
How am I supposed to know the estimated quarterly of it’s my first year in business? Feel like it makes more sense to pay at the end of the year on all of it
Seems easier to pay lum sum. This quarterly tax crap is so confusing. Danm irs
What’s the penalty for underpayment?
Is this only for businesses? Should an individual do it? I have unforeseen capitol gains, and end up paying penalties every year.
If I just started my business . And I’m not sure if I have to pay quarterly taxes or not should I say no to paying quarterly while registering my business with the irs? Another thing is it says that if I make $10,001 I should pay quarterly taxes the thing is how am I suppose to know if I haven’t had a year worth of income. And if I file no for quarterly taxes and make over 10,001 will I get a penalty for not paying quarterly because I’ve made over 10,001 ? Even if I pay my taxes on 10,001? Kinda confused man 🤷🏻♂️
Thank you sir. I started my LLC in Aug 3rd 2021. I haven't made much money yet. Now it's Sep, I don't have any extra money to pay the estimated quarterly taxes. What should I do?
If you don't have money for your taxes consider borrowing it, or maybe your parents can make a tax-free gift to you (up to $16K in 2022). Don't delay, that won't help you!! The IRS is worse than Judge Judy. " 'Um' is not an answer"
@@snorky4506 don’t give advice when you don’t know anything
@@X11CHASE I worked at the IRS for three years. You gotta pay your quarterlies.
Nice explanation! I wish more CPAs did videos like this lol
Nah..you just need one ;)
Im self employed can i pay it once a year when i receive 1099 or i must pay it quarterly with estimated amount? I made more than $5000 in one quarter.
I heard i will pay penalty if i pay it once a year.
Can someone please let me know.
Okay, Nguyen, what if I do various gig work, but I have been busy and only worked my w2 job up until May, now I am getting back to doing the side gig thing. I did not pay anything the first quarter, so can I skip the first quarter since I did no self employed work, now I am starting again? I generally pay at the end of the year since I don’t make a whole lot on the gig work……can I just wait? Last year Uncle Sam owed me money!!!!!!!
You can't skip quarters, as a business you have to pay every quarter as in report it.
how does one figure our their penalty if they wait 4 quarters to pay? an example is whem converting a lump sum from a traditional retirement account to a roth
Ok, but why NOT. you never stated why not to pay it. #2 at timestamp 7min your are not required to pay taxes its a suggest to pay, that why nothing ever happen to them, they are paying a suggested amount, so nothing can happen to them. it states it in the clause of W-4.
I’m going to start working as an independent contractor in the medical field for an agency . I don’t know how I should estimate my taxes because I don’t know how much I’ll make because each facility pays different and I don’t know if one month I’ll work 1 day or 15 days. Do I have to pay quarterly or can I just wait till the end of the year to pay my taxes. Also is it true that you don’t have to pay quarterly until after a year of being a independent contractor ?
Hi when I didn't pay mys on time they sent A finial Assessment letter pretty like a warning ⚠️ if I hiring one person but the business haven't really started yet do I still have to pay the letter for reemployment Report and employer Quaterly report
I would like help please. What are the quarterly reports? I own a business and it’s so frustrating because my cpa it’s so disorganized. I’m having to keep on going back forth and it’s just horrible. So what are quarterly reports and why she charging me for them? I know there’s quarterly taxes which we pay. We pay for accounting and then on top of that for those quarterly reports. Someone please help? ❗️❗️❗️
How much is the Quarterly Estimated Tax penalty?
If I DON'T pay the Quarterly Estimated Tax and put it in the stock market (let's say 8% returns) VS the penalty being like 3%....wouldn't I be profiting +5%?
It is riskier, but as long as I do what you said and set aside money for paying the taxes next tax season I would be getting +5%...right?
The problem i see with that plan isn't the gains. Its the risk of losses. One year in the stock market is a relatively short time and if you need that money in a year to pay your taxes but the stock market tanked, you just screwed yourself. Now you have to sell at a loss or hold your money in there until you gain it back and then you might have to not pay your taxes or go on an installment plan. For a short horizon, its better to invest in something less risky with a lower return.
So wait u only have to pay this if u self income and a business? Bc I have only unemployment income and made like 5,000$ on my recent tax since I got let go in 2020
Thanks for information !
This video was really helpful. Thank you.
I see your point for emergencies. I am going to take the chance and pay my estimated taxes because I have some other savings.
Thank you very much for your insight. So basically in the short term don't panic, but you said that you had clients who never paid their quarterly payments in the long term, and were never penalized because of it, so thats very interesting..
At that point, paying estimated quarterly taxes all relies on you because you hold the power, but the IRS can also let you know that they hold the power..
Interesting Head Scratcher.
So we really don't have to file quartley taxes??? We can just pay it all at once???
Wondering the same
Same question here
I always have paid all at once for the past 10 years... i just save and then pay it annually when taxes are due.
@@edymadiedohey so this is my second year of business and did not know about quarterly taxes, you said you have never done it, how much did was the penalty for that?
@@PNWMOTION I file annually as well I have never had a penalty.
What if you only worked self employed for a 1,5yr and decide you wanna go back to w2 work what happens then ?
I’m driving for Grubhub, I started in June and I had no idea that I had to do quarterly taxes. I miss the second payment and the third payment is due next week. I don’t know what to do, would you recommend paying it or paying the whole amount at the end of the year.
You aren't required to pay quarterly your first year in business.
You need to know how much to pay estimated if you owe more than 1000 for taxes--so that's why your first year is off to determine whether you'll pay more than 1000 in taxes. If you do, then after that first year you'll get a good idea how much you will owe for the following year.
When you're starting out its cheaper to pay the penalties than the accountant to do the estimated taxes for you.
We are coming up to third quarter, they took from my refund to pay some of my estimated taxes. I want to pay something this quarter. If my tax percentage has been 15.9% Should I take the estimate from last year and subtract what they took and divide by two to make two payments?
Do you have anyone you can recommend in Seattle area? I would love to use you as my cpa but if not who you recommend.
So how much is the penalty?
Does this apply to independent contractors?
As a small business owner am I required to hire a cpa? Can I pay them my self quarterly with out a cpa? Please help
Obviously you’re not required to hire help 🤣
Good advice 2020 social security taxes were deferred & stimulus help some.
Thank you 👍💯
What if your husband is a sole proprietor of business and you work for company (file married filing joint) and instead of paying estimated taxes, you have extra taken out of your paycheck to cover the tax liability? Is that ok or the same as paying estimated?
Yes that's fine.
The $1.00 make it rain has me dead.
It was my first year with my company, and I didn't pay. I am kind of scared even more bc I can't create an IRS account for my business. 😢
what do you think about those who are self employed and collecting PUA? will the unemployment be subject to self employment taxes or just federal taxes? i wasnt getting the 10% federal withheld at first and then opted to take them out once i realized the tax bill would be higher in 2021.
i should have asked, will i still be able to deduct business expenses?
I didn't know that IRS could've voided our installment plan because of 2019 owed taxes. Thank God for the EIDL loan which we used to pay the bill and were able to continue paying the current installment without penalties.
Also, I would like share a bit of information that's helpful. If you've experienced loss of Income, receiving unemployment or been stricken with COVID and can provide proof, you can request for a hardship for the penalties. If approve, the IRS will decrease in failure to file penalty and/or failure to pay penalty which can save you a couple of hundreds or thousands of dollars. It depends on how much you owe. Remember you must apply separately for each year as well.
I’m a Llc with elected s-corp. never paid estimated tax. This ok.?
I do some side hustles (ride share and instacart) off and on. I think I will likely not owe enough that I will receive a penalty for 2021, so I will probably not pay quarterly taxes this year. I am saving my estimated tax payments in a very conservative brokerage portfolio through acorns, hoping it yields a little bit through the year. If that doesn't work out (e.g., market crashes hard), worst case scenario I can rely on some other cash savings to pay taxes. As I said, I don't expect to owe much (less than $2,000).
this is my first year as self employed and I missed my 2 quarterly payments, will i have a penalty if i pay for example everything in my Q3? or Q4? is it easier if i just pay everything at the end of the year? will i be fined or get in trouble if i do ? i NEVER touch the money i put a side for taxes so its all in my savings account I'm just not familiar with the process yet
You may still get very mildly penalized if you pay in Q3 and Q4. But it will be less than if you paid it next year when you file your taxes.
@@NguyenCPAs I was told if you haven't been in a business a full year yet you are not expected to pay? My year anniversary starts April 9th 2022. Help!
@@NguyenCPAs would I pay my first quarter this April?
What if I buy equipment that’s Equivalent or more than my estimated quarterly taxes for my business?
You'd likely still owe taxes.
hello! can you make a video of the process to pay quarterly taxes?
Maryland charges a penalty. I would prefer to earn interest if I could.
After quitting i finally started crunchtime.. I see why my employer still owes me 140hrs .. Great video 💯 Thank You ✨
It took a 15 minutes to get to his point the point is that why wouldn't you just tell people to have an emergency fund everyone should have an emergency fund isn't that just baby step number one and then you wouldn't have this problem of thinking you're going to run out of money
The IRS is brutal I overpaid my estimated payments.. but IRS Still sends me a penalty for I believe "Uneven payments"
Taking out a loan to pay my taxes
Lol seriously taxes are the stupidest thing ever especially quarterly. I understand end of the year taxes whatever, but quarterly just makes business owners stress out
Becareful you don’t pay underpayment penalties.
Thats bad advice that could throw a person into an underpayment penalty. Especially in states that are pay as you go.
New laws 8% compounded daily if you don't pay
Can I pay quarterly tax with EIDL loan?
I would lean toward "no". However, if you're simply self-employed or sole proprietor, the line is more blurry and you are a little more safe doing it if you're not an LLC or something like that.
The USA has had one huge ongoing crisis since January 20, 2017
yikes i think the penalty is now 8%
Cảm ơn!
So just buy bitcoin with it 😊
All these assholes keep talking about the penalties of not paying but nobody has a working formula for HOW MUCH TO PAY IN QUARTERLY TAXES!!!
Normally what I do is set aside 35% per check in a high yield savings account. Then use that money to pay your taxes
these videos are a waste of time. all these answers and no responses
Terrible advice.
Legally speaking you HAVE TO PAY QAUTERLY
I pay my taxes because I love my country and it’s the right thing to do.
🤣🤣🤣
🤣🤣🤣damn weirdo