If you are required to pay quarterly estimated taxes with the IRS, you can pay online, by phone or by mail. Final installment of your 2020 estimated taxes is due by January 15, 2021. Individuals, including sole proprietors, partners and S corporation shareholders, may need to make estimated tax payments if:
- they expect to owe at least $1,000 when they file their tax return
- they owed tax in the prior year
Who pays estimated taxes?
Taxpayers who may need to make estimated payments include someone who:
- receives income that isn’t from an employer, such as interest, dividends, alimony, capital gains, prizes and awards
- has tax withheld from their salary or pension but it’s not enough
- has more than one job but doesn’t have each employer withhold taxes
- is self-employed
- is a representative of a direct-sales or in-home-sales company
- participates in sharing economy activities where they are not working as employees
- Wage-earners and salaried employees can avoid estimated tax payments through withholdings on their wages. They can use Form W-4 PDF to tell their employer how much tax to withhold from their pay. Anyone can change their withholding any time during the year
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