Can I skip quarterly tax payments and just make one lump sum payment?

[llowry61]

I hate doing taxes. RITA has threatened me time and again about making estimated payments. I have never done it and they have yet to penalize me.

 

[GypsmJim]

If you pay it all in the first quarter, the govt has your money all year but does not pay you interest.

If you pay it all in the last quarter, the govt charges you a penalty because you didn't pay on time.

Figure out what you might owe, and pay 1/4 of that amount each quarter. I realize it makes you have to think about things. But you have 2 options, let the govt squander your money or pay extra.

 

[LVSteve]

If you do withholdings from your sources of income you do not need to file quarterly returns. The trick is knowing how much to withhold. If your income is stable, then it's easy to base withholdings from last year's returns. I have taxes withheld on some of my pensions and on my SS.

That's the way I would prefer to do it when I retire, but a fair chunk of my retirement income will come from the UK. Hopefully I will be able to up my withholdings from the US sources to cover it. There may still fun in years where the exchange rate fluctuates to a large degree.

 

[Tom S.]

That's the way I would prefer to do it when I retire, but a fair chunk of my retirement income will come from the UK. Hopefully I will be able to up my withholdings from the US sources to cover it. There may still fun in years where the exchange rate fluctuates to a large degree.

Our uncle doesn't care where the money comes from, just that he gets it. As long as you don't owe large sums at the end of the year, the Infernal Revenue Service will be happy.

 

[ZGrand]

I hate it, but I pay mine quarterly. I set up reminders on my phone calendar that repeat every quarter every year. I don't want them to have a whole year's worth of estimated taxes without having to pay any interest.

 

[GypsmJim]

Our uncle doesn't care where the money comes from, just that he gets it. As long as you don't owe large sums at the end of the year, the Infernal Revenue Service will be happy.

That's not true. It's all about percentages. If you owe $100 for the year and you still owe $80 at the end, you will be penalized.

 

[mtgianni]

The State of Montana penalizes me if I don't pay an estimate of next years taxes. Now we are starting to actually earn some money in interest, it would seem foolish to me to give it to them all at once.

 

[BigBoy99]

I have my withholding tax taken out as a single person. When I file the returns, I file them as married. Each year I get a small refund so I don't have to worry about quarterly estimated taxes.

 

[Tom S.]

That's not true. It's all about percentages. If you owe $100 for the year and you still owe $80 at the end, you will be penalized.

Maybe they don't like you or you're on some kind of "naughty" list.

The only time I got in trouble was when I first retired and didn't know that SS was taxable until I went to file the next year. But that was a lot more than $80.

 

[HOUSTON RICK]

I hate doing taxes. RITA has threatened me time and again about making estimated payments. I have never done it and they have yet to penalize me.

Those tax administrators in those Ohio cities can get carried away with themselves.

 

[Gamecock]

I do not pay estimated tax. In my case, the penalty is so small ($31 last year), there is no reason to.

I assume you can always not pay it and just pay the penalty. Then, it becomes what's it worth to you?

 

[Dave_n]

That's the way I would prefer to do it when I retire, but a fair chunk of my retirement income will come from the UK. Hopefully I will be able to up my withholdings from the US sources to cover it. There may still fun in years where the exchange rate fluctuates to a large degree.

I too have a retirement pension from the UK however (probably unlike LVSteve) I fell into the longer requirement for a full pension as I left the UK in 1968 and did not pay into the UK Pension System the year I left. One of my neighbor's who is 10 years younger fell into the "maxed out at 30 years" category. Ah well, my wife (who never lived in the UK) gets her own UK Pension as my spouse. One amusing situation is that I have to file a specific IRS form each year for both of us since a 1099R is not issued by the UK Pension Service. Great fun when I first filed that form with the PA Tax Service (all retirement income is tax free of PA taxes) as they did not know what it was!! Dave_n