Get the free ESTIMATED TAX BY BUSINESS CORPORATIONS 2017

*30311791* TM 400 FT DR8A 016 .2 .0 Department of Finance 09 ESTIMATED TAX BY BUSINESS CORPORATIONS 2017 AND SUBCHAPTER S GENERAL CORPORATIONS For CALENDAR YEAR 2017 or FISCAL YEAR beginning, and

How to fill out estimated tax by business

How to fill out estimated tax by business

1. Determine if you are required to pay estimated tax. Generally, if you expect to owe at least $1,000 in taxes for the tax year and your withholding and credits will be less than the smaller of 90% of your current year's tax liability or 100% of your previous year's tax liability, you need to pay estimated tax.
2. Gather your financial records. You will need your income statements, expense records, and any other relevant financial documents to accurately calculate your estimated tax.
3. Calculate your expected annual income. Add up all your sources of income for the tax year, including self-employment income, rental income, and any other income that is subject to taxation.
4. Determine your estimated tax liability. Use Form 1040-ES to calculate your expected tax liability based on your projected annual income. Take into account any deductions, credits, and exemptions that apply to your business.
5. Divide your estimated tax liability by four. Since estimated tax payments are made quarterly, divide your total estimated tax liability by four to determine the amount you need to pay each quarter.
6. Complete Schedule C and/or Schedule C-EZ. These forms will help you report your business income and expenses, and calculate your net profit or loss from self-employment.
7. Make quarterly estimated tax payments. Pay the calculated amount each quarter by the due dates using Form 1040-ES or via the Electronic Federal Tax Payment System (EFTPS).
8. Keep accurate records of your estimated tax payments. Retain copies of all payment receipts and documents for future reference and to ensure you have proof of payment.
9. Review and adjust your estimated tax payments if needed. Throughout the year, regularly monitor your financial situation and adjust your estimated tax payments accordingly to avoid underpayment penalties.
10. File your annual tax return. Once the tax year ends, complete your annual tax return (usually Form 1040) by providing accurate and updated information about your business income, deductions, and credits. Include the total estimated tax payments made during the year.
11. Reconcile your estimated tax payments. Compare the total estimated tax payments you made throughout the year with the actual tax liability calculated on your annual tax return. Determine if you owe any additional tax or if you are eligible for a refund.

Who needs estimated tax by business?

1. Self-employed individuals who expect to owe $1,000 or more in taxes and have income not subject to withholding.
2. Small business owners and sole proprietors with a projected tax liability exceeding their withholding and credits.
3. Partners in partnerships, members of LLCs, and shareholders in S corporations who anticipate tax liability beyond their withholding and credits.
4. Independent contractors and freelancers with significant earnings subject to self-employment tax.
5. Individuals with investment income, such as rental income, dividends, or capital gains, that is not withheld upon.
6. Individuals who had a tax liability in the previous year and anticipate a similar or increased liability in the current year.
7. Individuals who want to avoid underpayment penalties and ensure timely payment of their tax obligations.

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What is estimated tax by business?

Estimated tax by business is a method of paying income tax on a pay-as-you-go basis, rather than waiting until the end of the year to pay the tax in one lump sum.

Who is required to file estimated tax by business?

Sole proprietors, partners in partnerships, and shareholders in S corporations are generally required to file estimated tax by business.

How to fill out estimated tax by business?

To fill out estimated tax by business, the taxpayer must calculate their estimated income for the year, determine the amount of tax they owe, and make quarterly payments to the IRS.

What is the purpose of estimated tax by business?

The purpose of estimated tax by business is to ensure that taxpayers who receive income that is not subject to withholding (such as self-employment income) pay their taxes throughout the year.

What information must be reported on estimated tax by business?

Taxpayers must report their estimated income, deductions, credits, and tax payments on their estimated tax forms.