Today TaxMama hears from Steve in the TaxQuips Forum with a timely question. He says. “I started paying estimated taxes in the first quarter of this year. But I haven’t earned any income this quarter, except unemployment – from which they took withholding. What do I do about my June estimated payment?”
That’s got to be tough – not having any revenue for such a long time. I am glad you remembered to file for unemployment?
You may as well start working the computations now. You’ll add to the computations each IRS Quarter, as the year progresses.
It’s a bit difficult to follow – even with tax software, you or your accountant have to do the calculations to place on each line.
In essence, by filling out this form each quarter, and keeping your Profit and Loss Statement on file along with a copy of this page, you’ll be able to tell IRS that you had little or no taxable income in any given quarter. You will be exempt from Estimated Taxes in quarters where you had no income. Or you may pay less, in quarters when your income was low – but enough to be taxable.
You may want to get help with this one. I hope your company puts you back to work soon.
And remember, you can find answers to all kinds of questions about estimated taxes, and other tax issues, free. Where? Where else? At www.TaxMama.com.[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link – it’s free!]
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