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I missed sending my quarterly tax on Sep. 15 (I sent on Jan. 15, Apr. 15 and Jun. 15). Should I send it now or skip and wait until Jan. 15 next year to send both amounts in one check with the Jan. 15, 2017 voucher (Sep. 15 amount + Jan. 15 amount)? Any penalties if I send it now because the remaining vouchers they sent me are for Sep. 15, 2016 and Jan. 15, 2017?

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traderranger said:   Any penalties . . .

The only "penalty" I've had from being underwithheld was the interest from the time when the payment was due until the date it was received. It's been small dollars. If you send it now vs later, it'll save you that much in interest. I guess it just depends on whether the rate you pay the IRS is less than what you can earn/pay elsewhere in deciding the right thing for you to do.

You can look at the penalty for underpayment form to understand how it works. You pay a fraction of the penalty for each day it is late. Therefore to minimize the penalty you want to send it in as soon as you can.

There is also a way to calculate the penalty called annualization if your income is uneven through the year.

I think interest is usually calculated from when it was due (i.e. September 15th) to the next quarterly filing after its due, i.e. Jan 15, 2017 (assuming you pay on or before Jan 15). That said, interest rates on federal taxes aren't very high. Penalties will be determined by how much you owe and what your income situation is versus last year. There is a threshold below which there are no penalties, and the penalties are likely not that horrible even if they apply. Your state income tax situation could be very different from the federal though, so bear that in mind.

http://finance.zacks.com/penalty-paying-federal-estimated-taxes-...

The IRS imposes a penalty for late or insufficient payments. As of 2012, that's 5 percent, calculated from the due date until the payment is made. If your payment is a month late, you'll owe 5 percent of the amount of the payment for that month, for instance about $2 on a $500 quarterly payment.

Short-term Borrowing:
Delaying payment of estimated taxes can actually be a way to get a short-term loan at low interest. If you need that $500 for an emergency, just delay that quarterly payment by a month and pay the penalty. That may be easier and cheaper than getting a $500 short-term loan or taking a cash advance from a high-interest credit card.

Can you get any tax withholdings done, rather than paying via estimated payments, for example from a paycheck or an IRA distribution?  Those don't have the timing issue for purposes of interest, and are considered to be made evenly regardless of when they're done.

GoldenSacks said:   http://finance.zacks.com/penalty-paying-federal-estimated-taxes-... 

The IRS imposes a penalty for late or insufficient payments. As of 2012, that's 5 percent, calculated from the due date until the payment is made. If your payment is a month late, you'll owe 5 percent of the amount of the payment for that month, for instance about $2 on a $500 quarterly payment.

Short-term Borrowing:
Delaying payment of estimated taxes can actually be a way to get a short-term loan at low interest. If you need that $500 for an emergency, just delay that quarterly payment by a month and pay the penalty. That may be easier and cheaper than getting a $500 short-term loan or taking a cash advance from a high-interest credit card.

  There are two rates here, and the article above doesn't make the differences clear.  First is the underpayment interest rate, which is slightly above 3% annualized now, and runs from whenever you were supposed to pay (via estimated payments for example) until you actually pay them.  The second is a much larger "failure to pay" penalty which is 0.5%/month of the taxes due (~12% annualized, capped at 25%).  That one is if you don't pay by the due date, possibly including an extension if you requested one (so April 15th or Oct 15th typically), and is in addition to the first rate.  There is also an even larger "failure to file" penalty if you also don't file your tax return by your (possibly extended) due date, which is 5%/month of taxes due (a very big annualized rate, again capped at 25% possibly in combination with the second one).  

https://www.irs.gov/taxtopics/tc653.html 
https://www.irs.gov/uac/failure-to-file-or-pay-penalties-eight-facts

is there a penalty for not making (sufficient) qtr payments if , when you do your taxes, you end up not paying that much in taxes because of less income this year compared to last?

Send the payment now but date the check Sept. 15 and blame the post office. I doubt the IRS will go after you for a few bucks interest.

atikovi said:   Send the payment now but date the check Sept. 15 and blame the post office. I doubt the IRS will go after you for a few bucks interest.
  This does not even have a remote chance of working. You know there is this little thing called a postmark. Are you going to claim the post office held the envelope for a month before postmarking it???

rufflesinc said:   is there a penalty for not making (sufficient) qtr payments if , when you do your taxes, you end up not paying that much in taxes because of less income this year compared to last?
  The safe harbor rules are typically for withholding payments, not estimated payments.  I think you could still be dinged with some interest if you paid your estimated quarterly ones towards the end of the year even if you made less.  If you withheld the right amount or more, you wouldn't get that interest even if you withheld it towards the end of the calendar year.

btuttle said:   
atikovi said:   Send the payment now but date the check Sept. 15 and blame the post office. I doubt the IRS will go after you for a few bucks interest.
  This does not even have a remote chance of working. You know there is this little thing called a postmark. Are you going to claim the post office held the envelope for a month before postmarking it???

  Exactly. Envelope fell off the belt into a corner of the sorting room and wasn't found until weeks later. Good an excuse as any for the post office. I had to have the DMV mail out license plates 3 times because the first two were lost by the p.o.

rufflesinc said:   is there a penalty for not making (sufficient) qtr payments if , when you do your taxes, you end up not paying that much in taxes because of less income this year compared to last?
  If you're short in first couple qrt payments and just make the rest of regular full payments, you will be short in every qrt after the one you shorted.compounding the penalties .
happened to me last year.  

I know this is a bit off topic, but can I pay $800 in estimated ttax even if I will not need to. Am thinking of doing this one time to satisfy my American Express credit card purchase requirements to earn bonus points. Thanks for any input.

bopc1996 said:   I know this is a bit off topic, but can I pay $800 in estimated ttax even if I will not need to. Am thinking of doing this one time to satisfy my American Express credit card purchase requirements to earn bonus points. Thanks for any input.
  Should not be a problem.         http://money.usnews.com/money/blogs/my-money/2013/02/13/should-y...

Thanks, read all comments and mailed a check dated Sep. 15 with the Sep. voucher they had sent me.

SCORE! And I got all the red for this suggestion?



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