Estimate From Current Income
Use current income, deductions, credits, and withholding to project your likely tax position. A projection can be updated as business results change.
- Review prior-year tax information.
- Update the projection for current-year income.
- Include withholding and payments already made.
Watch Due Dates
Estimated payments generally follow quarterly due dates, but the right approach depends on your circumstances. Keeping a calendar of tax deadlines helps reduce the risk of missed payments.
Adjust When Circumstances Change
A large contract, asset sale, change in payroll, or new source of income can change your estimate. Revisit your projection when a major financial event occurs.
This helped me understand why reviewing books before year-end matters so much.
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