Question

Income and quarterly taxes

Forum|Forum|4 years ago
October 27, 2021
1 reply
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I am self-employed as a digital artist. Some months I make $0, and some months I make $1,000. Does that $1,000 average out between the 3 months making my quarterly payment nothing? How does that work? Do I only pay for the months where I am making over the $400 threshold?

Thank you!

Critter-3

First the $400 is an annual benchmark not a quarterly one ... next you can average the quarterly income when computing the quarterly estimated payment needed.

I

IdrathernotAuthor

If nothing was made within the quarter than nothing has to be paid, correct? What if a quarterly payment was missed?

Critter-3

Correct ... and so a payment is simply not made. Keep good records of your income and expenses per quarter in case you need them for a possible penalty abatement later.