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IC tax - pay your SE taxes quarterly or you get penalized - jj

Posted: Feb 02, 2010

I have heard people on here say you have to pay your SE taxes quarterly or you get penalized. I didn't do that. I took my stuff to H&R block and they did my taxes with just a regular SE status, added to my employee status for my employee job. They asked me if i had paid in anything and I told them no, but I didn't get penalized in any way. Is that normal? I am asking if the IRS will come back later and penalize me, or is that it, I just pay them at the end of the year and all comes out fine? I'm confused.

Nevermind, think I found it - jj

[ In Reply To ..]
After getting the child tax credit and such, I didn't "owe" any taxes, I got some back. So the IRS site says you don't have to pay estimated taxes if you don't owe taxes from the previous year.

I did not pay quarterlies for a whole year once - and this is what happened

[ In Reply To ..]

I'm glad you got it figured out, but let me tell you how I got penalized for not paying my estimated quarterlies. It was not really a big deal.

In 2008 I did not pay any of my quarterlies, I just didn't have the cash. I knew would get dinged on my return, which I did with having to pay the whole sum at one time, but the actual penalty for not paying the quarterlies was not really that bad... I'm thinking it was something like $97 or $112, maybe $120.

Way worse than the penalty was having to now come up with that owed tax all at once. That was more of a hardship than coming up with a quarter of it throughout the year would have been. I will never let that happen again (knock wood).

In 2009, quarterlies were an absolute priority, no budging or fudging, and luckily I had a pretty good year until July when I lost an account to offshoring, then again in November when I lost another account to a cut-rate bottom-basement discount service. I still found a way to pay the quarterlies, and since my income went way down the second half of the year, yet I paid estimated taxes based on my 2008 income which was nice and up there, I am hoping I actually overpaid and maybe will get a little refund... or at least have the shortage be a minimal amount.

Paying my own taxes and health insurance are the main reasons I am looking to get out of the IC business. The non-monetary benefits are not making up for how much it is costing out of my pocket.

Got one worse than that, oh my! - Bad advice

[ In Reply To ..]
Last year doing our taxes, I told the lady who does them every year what my income would be this year, including a social security check, retirement fund and my payroll check. She advised me I would probably owe an extra 1,000 on my taxes. Like others I did not pay through the year but get this, thanks to someone on the board I found out this person probably was wrong, very wrong and instead after calling IRS and talking with them my tax will be abount $7500.00 for this year. I was saving towards that starting in November and then decided to just draw out of bank and pay the entire amount when I do my taxes. This was not my highest tax burden ever but I have started having 25% of taxes taken out of my social security check each month now.

Did this before, too. - TaxesSuck

[ In Reply To ..]
I have never been able to save that money, so I switched to employee status at my part-time MT job. BUT I was able to put in for a payment plan each year and the IRS always accepts it. Just something to think about if, like me, you can't save that money no matter how you try.

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