If the fact that today is a tax deadline day slipped your mind, you’re not alone. But the fact that many others overlooked the filing deadline won’t help if your state comptroller or the IRS selects you or your business as the target of an audit.
Don’t Let an Estimated Tax Deadline Sneak By
If you are an independent contractor or profitable small business, you are required to make quarterly estimated tax payments to state and federal tax authorities. Depending on where your business is based, you may also be required to file quarterly tax reports and make payments to local taxing authorities.
Even if you are not profitable, you may still be required to file quarterly reports showing that you are not profitable. Even 501(c) (3) non-profit organizations may have to file quarterly reports and make quarterly payments on sales taxes they are required to collect.
Why is this required when ordinary taxpayers don’t have to pay the tax bill until April 15? Because the IRS and your state comptroller don’t want to wait until the end of year to collect from profitable small business (including S Corps, C Corps, Partnerships, LLCs, and Sole Proprietorships) and the independent contractors who pay self-employment taxes.
A new white paper from 1-800Accountant has all the details about estimated tax deadlines, including answers to questions like:
- Why Haven’t I Heard About Estimated Tax Payments Before?
- Do I Have to Make Estimated Tax Payments?
- Why Do I Have to Pay Every Quarter?
- How Do I Calculate and Make Estimated Tax Payments?
- When Are Payments Due?
- Do I Have to Pay Estimated Taxes to My State?
The white paper titled What Small Businesses and Independent Contractors Must Do About Taxes AFTER April 15 is available now for free download on the resources page of 1-800Accountant.
What If You Missed the Tax Deadline?
If you were required to make a quarterly payment today, chances are you also missed the first quarterly payment deadline of the year (April 15). The law says that if you do not make the required quarterly payments, you’ll have to pay penalties for not making them on time. However, before you panic, talk to your tax advisor.
You could be among the small business owners, freelancers, or independent contractors who aren’t required to make quarterly payments because you expect to owe less than $1,000 (if you are an individual taxpayer) or $500 (if you are a small business) when you file your year-end tax return for 2013. Even if you should have filed and didn’t, don’t panic. Most tax authorities had rather work out a payment plan with someone who is trying to follow the rules than take action against someone who is ignoring them.
Your tax advisor can help you with a strategy to avoid future trouble and handle any past IRS or state tax problems. One of the best strategies, of course, is not to miss any further deadlines. After today, the next four quarterly estimated tax payments are due on:
In general, estimated taxes are due on the 15th day of the month in January, April, June, and September of each year, or on the next business day if the 15th falls on Saturday or Sunday.
If you have questions about these due dates, or want clarification on whether or not you are subject to paying an estimated tax, the tax advisors at 1-800Accountant can help, and you may find guidance in the free small business tax planning white paper, too.
Photo credit: This photo from the 401(K) Photostream was made available under a Creative Commons license on Flickr.