How to pay my tax quarterly?
Since you will be reporting self-employment income using a Schedule C, you cannot use the 1040EZ or 1040A forms to report your taxes next April. You will have to use Form 1040. Form 1040-ES is used to pay estimated taxes each quarter. There are two ways to pay estimated taxes. In the first method you total your income each quarter and subtract your exemptions and deductions. These are all estimates based on expected totals at the end of the year. Just follow the directions on Form 1040-ES. The easier method is to just pay one-fourth of the total taxes you paid on last year’s 1040. The disadvantage of this method is that you will overpay your estimated tax if your income is less than last year. This overpayment will be refunded next April or you can reduce the amount of your last payment in January. On the other hand, if you earn more than last year, you will underpay your estimated taxes. This is okay and doesn’t require a penalty, but you will owe the balance of taxes in April.
