With one week left to file your federal taxes, it’s easy to overlook another sneaky deadline: the due date for first-quarter estimated tax payments.
If you have income from self-employment, a small business, gig economy work, investments and more, you must make a payment by April 18.
You need to pay if you expect to owe $1,000 or more in taxes for 2022, according to the IRS. But estimated payments may reduce or eliminate penalties.
“Everyone needs to pay taxes,” said certified financial planner Bryan Hasling, partner at Lodestar Private Asset Management in Alamo, California. “And the IRS strongly prefers that you pay them steadily across the year as opposed to waiting until the last minute.”
The fastest way to make a quarterly estimated tax payment is through IRS DirectPay or sending money through your IRS online account. However, there are other available options listed at the IRS online payments webpage.
The late payment penalty is 0.5% of your balance due, for each month after the due date, up to 25%.
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