Pay Estimated Taxes? 3rd Quarter Payment is Due on Monday.
The Internal Revenue Service (IRS) recently released a publication reminding taxpayers the third quarter estimated tax payment for 2019 taxes is due soon. Normally, the tax payment is due on September 15th. However, since September 15th falls on a Sunday this year, the agency expects taxpayers to make their payment by Monday, September 16th.
What is an estimated tax payment?
The United States tax system is essentially a pay as you go system. As a result, the government expects taxpayers, both individuals and businesses, to make payments throughout the year. A failure to do so can result in penalties. The government generally applies penalties when less then 90% of tax obligations are paid throughout the year.
Not everyone needs to make an estimated tax payment. In most cases, employees and workers make payments throughout the year through automatic paycheck deductions. Generally, the IRS expects estimated quarterly payments from the self employed and investors.
A note of caution: the IRS is cracking down on the gig economy. As a result, those who take on side jobs with Uber, Lyft, Etsy and other similar services need to make sure they are properly reporting their income. A failure to do so could result in the IRS knocking on your door or a mailing with notification of an impending audit.
How do I pay my estimated tax?
The IRS offers online payment options on their website. Taxpayers can also make the payment through a traditional mailing, wire or electronic funds withdrawal.
The fourth and final quarterly payment will be due January 15, 2020.
