Estimated Tax

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Estimated tax

Tax to be paid quarterly on income that is not subject to withholding tax, including self-employed income, investment income, alimony, rent, and capital gains.

Estimated Tax

Taxes paid to the IRS on a quarterly basis on all income not subject to withholding. Estimated taxes most prominently affect self-employed persons, but they must also be paid on alimony, rents, and capital gains. Persons who file estimated taxes must also file 1040 forms and, if necessary, pay any taxes they may have underpaid on their estimated taxes.

estimated tax

The estimated tax liability on income that is not subject to withholding. Individuals with even moderate investment income are generally expected to file a declaration of estimated tax and to pay quarterly installments on the estimated tax liability.

Estimated Tax

The amount of tax a taxpayer expects to owe for the year after subtracting expected amounts withheld and the amount of any expected credits.
References in periodicals archive ?
Safe harbors for corporate estimated taxes or R&D expenditures would make the law simpler, he stated.
Americans participate in a pay-as-you-go tax system through withholding and estimated taxes.
With this change, taxpayers will be required to use the IRS's Electronic Federal Tax Payment System (EFTPS) to make federal tax deposits of various withheld and estimated taxes.
For tax years beginning in 2009, in computing estimated taxes, an individual uses 90% of the tax shown on the individual's return for the preceding year instead of the 100% required by Sec.
Occasionally we list multiple extra items--such as financial planning, a yearend tax planning meeting, additional services in connection with the sale of rental property, researching cost basis of mutual funds sold, calculation of S corporation basis, preparation of the next year's estimated taxes, prior years' income annualization for estimated tax penalty reduction, alternative minimum tax credit calculation or any of a few dozen other items.
If estimated taxes are overpaid, the taxpayer has made an interest-free loan to the government.
Current law effectively requires large corporations to overpay their estimated taxes, without the benefit of interest, or in order to avoid an underpayment penalty under section 6655 of the Code.
It incorporates about $100 million of proposed tax adjustments and redirections, including $30 million from quarterly filing of estimated taxes, nearly $40 million from redirection of sales taxes from highway and water, and $10 million inheritance tax decoupling.
This is usually done for clients with lower income than the previous year who do not (and should not) want to pay estimated taxes based on the protective prior-year tax.
The provision provides that no penalties will be assessed for underpayment of estimated taxes owed prior to April 15, 2003, if the underpayment is due to this change in the law.
The Supreme Court disagreed and held that IRC section 6513(b) required that the withholding and estimated taxes be considered paid on April 15, 1989, which was outside the lookback period.
In addition to filing a separate corporate tax return, a FSC must also separately pay estimated taxes.

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