IRS Quarterly Payments
The Internal Revenue Service mandates certain taxpayers to make quarterly estimated tax payments. If you’re earning income that isn’t subject to federal income tax withholding, you must make quarterly estimated tax payments.
Anyone that’s earning income that is not subject to federal income tax withholding must pay estimated taxes. Use Form 1040-ES to figure out how much you owe for the quarter and pay the IRS. The reason why we have such a thing as estimated taxes is that the IRS wants taxpayers to pay taxes in portions rather than paying at once which is easier for the taxpayers and the IRS as the government is funded year-round.
The estimated taxes are a great way to ensure you don’t owe the IRS at the end of the year. Because there is no one that’s withholding from your income as an employer would, you can pay more to ensure you don’t owe taxes if the previous quarter’s payment was lower.
The Internal Revenue Service requires taxpayers to pay their estimated taxes within 15 days following the month-end. Any payments made after the deadline is subject to late payment penalties. Here are the deadlines for quarterly federal estimated taxes.
- April 15 for the 1st quarter
- July 15 for the 2nd quarter
- October 15 for the 3rd quarter
- January 15 (following year) for the 4th quarter
There are several channels through the estimated taxes can be paid. The easiest way to pay taxes is through online payment methods. You can pay taxes using your bank account or debit/credit card. While payments with bank accounts aren’t subject to any fees as you are paying directly to the IRS, the payments made with a card are subject to processing fees. This is because payments are made to payment processors rather than the IRS. The payment processors forward your payment and that’s the reason for the fees. As for how much you’re going to pay in fees, it depends on what you pay with. For debit cards, the fees are fixed, ranging from $2 to $4. The fees are a certain percentage of the total payment for credit cards that are between 1.5 and 2.5 percent. The fees are subject to change and there is almost always an increase during the tax season.
