Do I Need To Pay Estimated Tax On My Partime Business If I Have A Job?
If you are starting this time of year and you have a job in which you have at least enough tax withheld to typically break even at tax time, I would say you can skip the estimates this year, but I would plan to do them next year when you have a whole year of your side income. One of the ways to avoid the penalties others have told you about is to make sure you have enough tax withheld from your job’s paychecks to pay for LAST year’s total tax liability. So if you worked the same job both years and you make the same or more money this year, that will cover you. You may owe tax for your new business when you file, but no penalties that way. Next year you should do something to pay in. The IRS doesn’t care how they get it – just so they get their share in the quarter in which the money was earned. So you could always just bump up your withholdings from your job – drop to 0 allowances if you aren’t already, or add a fixed amount extra per paycheck – by filing a new W-4 at your job.
