1040 ES?? Tax question...

[chiapet]

My accountant just sent our taxes to us and, of course, we owe (I never get a return!!). But this year he attached this thing called 1040 ES, estimated tax for 2008. Basically we have to pay $6000 towards next year''s taxes!! I''ve NEVER seen this before and am in complete shock. Anyone have any idea what this 1040 ES is about?

I plan to call my accountant tomorrow morning but I can''t sleep because I''m all stressed out about the $6000 that I have to pay this year. Anyone have had this happen to them?

 

[Skippy123]

Well several people I know pay estimated taxes, because they are self employed. Here is a link that should help answer your question in the 2nd paragraph http://www.irs.gov/pub/irs-pdf/f1040es.pdf If not, I am sure your accountant will tell you why.

 

[Girlrocks]

I am self employed and pay estimated taxes each year. Supposedly, if you don't prepay when you know you are going to owe, then they tack on penalties and late fees. Mine are due in 4 installments...April 15th, July 15th, September 15th and January 15th. I have no idea who came up with that schedule (the IRS!). Anyway, I usuually skip the April 15th payment because that is the same day I have to have my 2007 tax payment in by. Then I double up on the July 15th payment.

It just softens the blow rather than having to come up with the money in one lump sum the following year.

My accountant prepares payment coupons and envelopes for each payment for me also.

 

[Eva17]

Ditto Gridlocks.

Try not to stress over it. It is definately not one of those worrisome IRS situations. Just ask your acct if he reccommends 6k for the year or for the first quarter payemt.

 

[chiapet]

Thanks guys! That''s basically what my accountant told me but I was still skeptical

I do earn 20% of my income through self-employment but I didn''t think that I would owe that much for next year!! But my accountant did say that if I overpaid, then I''ll end up getting the money back next year. Sigh. Makes me want to move to Seattle.
Thanks for all the replies!

 

[Dee*Jay]

Date: 4/3/2008 8:00:27 AM
Author: Girlrocks
I am self employed and pay estimated taxes each year. Supposedly, if you don''t prepay when you know you are going to owe, then they tack on penalties and late fees. Mine are due in 4 installments...April 15th, July 15th, September 15th and January 15th. I have no idea who came up with that schedule (the IRS!). Anyway, I usuually skip the April 15th payment because that is the same day I have to have my 2007 tax payment in by. Then I double up on the July 15th payment.

It just softens the blow rather than having to come up with the money in one lump sum the following year.

My accountant prepares payment coupons and envelopes for each payment for me also.

Please forgive the digression but my accountant just sent me coupons to mail in estimated payments for 2008 (this is the first year that I have to do this) and aside from the April 15 payment I seem to have a payment due on JUNE 16th (not July -- but my other coupons match the September and January dates). I also checked out the IRS site and that seems to be correct. So is the June payment calculated using only 2 months of income (April and May) or am I just missing something here???

 

[Girlrocks]

Date: 4/6/2008 8:12:15 PM
Author: Dee*Jay

Date: 4/3/2008 8:00:27 AM
Author: Girlrocks
I am self employed and pay estimated taxes each year. Supposedly, if you don''t prepay when you know you are going to owe, then they tack on penalties and late fees. Mine are due in 4 installments...April 15th, July 15th, September 15th and January 15th. I have no idea who came up with that schedule (the IRS!). Anyway, I usuually skip the April 15th payment because that is the same day I have to have my 2007 tax payment in by. Then I double up on the July 15th payment.

It just softens the blow rather than having to come up with the money in one lump sum the following year.

My accountant prepares payment coupons and envelopes for each payment for me also.

Please forgive the digression but my accountant just sent me coupons to mail in estimated payments for 2008 (this is the first year that I have to do this) and aside from the April 15 payment I seem to have a payment due on JUNE 16th (not July -- but my other coupons match the September and January dates). I also checked out the IRS site and that seems to be correct. So is the June payment calculated using only 2 months of income (April and May) or am I just missing something here???

You''re right, it is June 15th (I just took a look at my coupons too). I mail in the same amount each time. For example, if I owed $2,000 for 2007, then I mail in $500 for each payment towards the 2008 estimate.