Quarterly Taxes Question

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Topic Author
zguy
Posts: 12
Joined: Wed May 16, 2018 4:03 pm

Quarterly Taxes Question

Post by zguy » Thu Jan 03, 2019 12:42 pm

Hi All,

I will be receiving a K1 for the first time this year, but unfortunately did not pay any quarterly taxes throughout last year. Would making a 4th quarter payment by Jan 15th in the amount to bring me within the limits of the safe harbor help me to avoid any underpayment fines/fees or am I looking at some no matter what? All in all I think I should be owing about $30k, the amount to bring me within safe harbor is far less than that. Any advice is appreciated. Thank you!

Gill
Posts: 5498
Joined: Sun Mar 04, 2007 8:38 pm
Location: Florida

Re: Quarterly Taxes Question

Post by Gill » Thu Jan 03, 2019 12:48 pm

You're too late to take advantage of the safe harbor rules. I would suggest making a 1/15/19 estimated payment so you will have paid in 90% of what you estimate as your eventual 2018 total tax. Are you sure the K-1 covers the calendar year 2018?
Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

livesoft
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Joined: Thu Mar 01, 2007 8:00 pm

Re: Quarterly Taxes Question

Post by livesoft » Thu Jan 03, 2019 1:20 pm

You gotta do what you gotta do. I don't see why you wouldn't make the payment now if you have the cash and let the extras fall where they may. Any extras can't be much at all, don't you think?
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kaneohe
Posts: 5751
Joined: Mon Sep 22, 2008 12:38 pm

Re: Quarterly Taxes Question

Post by kaneohe » Fri Jan 04, 2019 9:34 am

Welcome to the (Sch)AI club. Whether you pay a penalty or not depends on when you earned that K-1 income and all the other income this yr. Take a look at F2210 and its Sch AI............you may never want to see it again :happy
Your state may have a similar form. If you earned the K-1 income in Q4 you may get away with the estimated payment for Q4. If you earned that income all year, you are likely to owe an underpayment penalty for the earlier quarters but paying the Q4 installment should stop the penalty from increasing if you pay enough.

Topic Author
zguy
Posts: 12
Joined: Wed May 16, 2018 4:03 pm

Re: Quarterly Taxes Question

Post by zguy » Thu Jan 10, 2019 11:58 am

Thanks for the replies everyone.

Checked out F2210, seems like the penalties are pretty minimal.

I'll just pay 4Q, see what happens and do better this year!

clydewolf
Posts: 743
Joined: Tue Jul 21, 2015 12:51 pm

Re: Quarterly Taxes Question

Post by clydewolf » Thu Jan 10, 2019 4:07 pm

You could handle the income tax for your K1 income in several ways:
- Increase your withholding from your wages.
- If you are at least age 59-1/2 take a December distribution from an IRA in the amount of your K1 tax due and have it all withheld for income tax.
- Use the IRS Direct Pay from your bank account: https://www.irs.gov/payments/direct-pay
- Make estimated quarterly payments using form 1040-ES.

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