What you’ll discover:
When are self-employed persons’ projected taxes for the second quarter of 2021 due?
How can I figure out my anticipated taxes for the second quarter?
Would I owe taxes if I obtained a PPP loan which was forgiven?
What are the various methods for paying my quarterly taxes?
What happens if I don’t pay my anticipated taxes for the second quarter?
Make preparations to satisfy your quarterly expected payment commitments.
If you are self-employed or plan to owe the IRS $1,000 or more when you file your 2021 tax return in 2022, you are usually obliged to make estimated tax payments to the IRS. If you had no tax obligation for the 2020 tax year, were a U.S. citizen or resident for the whole year, and your 2020 tax return covered a 12-month period for income, you do not need to make anticipated tax payments in 2021. Here’s everything you need to know about submitting estimated taxes for the second quarter of 2021.
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When are self-employed persons’ projected taxes for the second quarter of 2021 due?
The tax system in the United States is “pay as you go,” therefore anticipated taxes are payable quarterly. Each taxpayer is expected to pay their anticipated income and self-employment taxes due for the most recently completed calendar quarter.
The deadline for filing taxes for the second quarter, which runs from April 1 to May 31, 2021, is June 15, 2021. The IRS just extended the deadline for submitting individual tax returns and payments for 2020 from April 15 to May 17, 2021. This delay, however, has no effect on quarterly anticipated tax payments.
How can I figure out my anticipated taxes for the second quarter?
You may utilize IRS Form 1040-ES if you think you owe quarterly estimated taxes. To get your projected payment amount, multiply your estimated adjusted gross income for the year by your taxable income, estimated deductions, and credits.
To assist calculate these amounts, you may use your most recent tax return as a reference, changing your expected income amount for the year based on current estimates. If you estimate too much or too low, you may compensate by adjusting the computations and quarterly remittance for the third quarter.
Would I owe taxes if I obtained a PPP loan which was forgiven?
Forgivable Payroll Protection Program (PPP) loans for qualifying small enterprises were part of the tax relief given by the CARES Act. If loan profits were utilized for certain kinds of company costs, the whole loan amount may be forgiven.
Under the Internal Tax Code, discharged debts is normally classified as taxable income. The CARES Act, on the other hand, expressly exempted forgiven PPP debts from taxes. To put it another way, if you obtained a PPP loan and had it forgiven, the loan proceeds are not taxable.
Moreover, the IRS clarified and actually overturned earlier advice in January 2021, indicating that costs paid with forgiven PPP loan funds may be tax deductible if the expenses are ordinarily tax deductible.
What are the various methods for paying my quarterly taxes?
There are various options for submitting your second quarter anticipated tax payment. To begin, print and send your 1040-ES form along with a check. If you want to pay online, you may use your bank account or a credit or debit card (fees may apply). Another alternative is to use the IRS2Go app on your phone or tablet to pay.
You may also make federal tax deposits, installment agreement payments (if applicable), and quarterly anticipated tax payments using the IRS Electronic Federal Tax Payment System (EFTPS). In reality, you may utilize the EFTPS system to pay your anticipated taxes on a weekly, bi-weekly, monthly, or other periodic basis, which may assist certain taxpayers with budgeting.
What happens if I don’t pay my anticipated taxes for the second quarter?
It may be tempting to postpone paying your quarterly anticipated taxes in the hope that you will pay them all when you submit your 2021 tax return next year. Nonetheless, this might be an expensive error. Underpayment penalties may apply if you do not pay enough during the year, whether via tax withholding from an employer’s salary or anticipated tax payments directly to the IRS.
If you owe less than $1,000 after deducting taxes withheld and anticipated payments when filing your 2021 tax return, or if the amount you paid was at least 90% of the taxes you owe for 2021 or 100% of the taxes owing for 2020, you will not suffer an underpayment penalty. Some restricted exclusions may apply, such as penalty exemptions for catastrophic losses, natural disasters, or other unique circumstances that render the penalty inequitable, or if the underpayment was caused by your retirement or incapacity rather than purposeful negligence.
Make preparations to satisfy your quarterly expected payment commitments.
Small company taxes may be complicated. State and municipal tax agencies may also need quarterly anticipated payments, however the timeframes and procedures may vary from those required by the federal government. It is critical to understand your responsibilities so that you may be proactive in fulfilling them. If you need help determining your anticipated tax due or have questions, contact a lawyer right once.