How do I estimate quarterly taxes


 See IRS Publication 505 or Form 1040-ES, Estimated Tax Payments for Individuals, for clear guidelines on when to file these payments and how to calculate the payment amount. The method of determining estimated tax payments differs depending on whether you have a steady income stream throughout the year or large swings in income during a specific year.

When determining quarterly estimated tax payments, remember that the default tax rates and information in the Tax Planner are based on the best information available as of August 2011. Those rates and regulations are likely to change. As you use the Tax Planner for 2011, you should update these amounts as soon as they become available, through Quicken online updates.

If you have Internet access, you can get information about changes to current rates and regulations from within Quicken. Click the Planning tab. Click the Tax Center button. Choose Tax Tools and then Online Tax Tools.

1. Estimate your projected taxes, being sure to use projected annual figures, rather than year-to-date figures, for each amount entered.

2. On the Estimated Tax Payments page, in the Estimated Taxes (1040-ES) Paid to Date and Projected Future Estimated Tax fields, type 0.

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    To access the Estimated Tax Payments page, click the Planning tab. Click the Tax Center button. Choose Tax Tools and then Tax Planner. In the list on the left side of the Tax Planner, click Tax Payments.


    Tax Planner calculates your remaining tax due if you make no estimated tax payments.

3. If you plan to make four estimated tax payments, as is typically the case, divide the Remaining Tax Due amount by four. This is the amount you should pay for each of your four quarterly estimated tax payments.

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    You should evaluate your quarterly estimated tax payments when the first payment is due (for most people this is April 15). If your projected income changes during the year, you may need to recalculate the amount you will owe for subsequent quarterly estimated tax payments. IRS Publication 505 or your tax professional can provide you with detailed instructions.

Notes

This method of estimating quarterly payments should work for most people who have steady incomes. If you don't have a steady income and need to file quarterly estimated tax payments, see IRS Publication 505 or Form 1040-ES, Estimated Tax Payments for Individuals for guidelines on determining your payment amounts.

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