Estimated Taxes Due September 15th
September 15th is the deadline for family child care providers to file your federal estimated tax payment for the third quarter of the year.
The third quarter includes the months of June, July and August.
The fourth quarter includes the months of September, October, November and December.
Yes, the tax quarters for estimated taxes are not equal!
Most child care providers do not need to file estimated taxes (IRS Form 1040 ES Estimated Tax for Individuals). This is because their spouse usually has enough withheld in taxes to cover them.
You are most likely need to file estimated taxes if you are single or you have a spouse who is unemployed or self-employed.
If you are not sure if you or your spouse has paid in enough taxes for the months of June, July and August, you should make a tax payment with this form. You goal is to have paid in at least 90% of the taxes you owe for this quarter to avoid paying a penalty. If you pay in too much you will get a refund.
How do you know how much you will owe in taxes? If you were in business last year, use last year as a guide. If this is your first year, use 20% of your gross income (parents fees plus Food Program income) for June, July and August as a conservative guess of how much you will owe.
Lastly, check your records to see if you will owe any state income taxes. If so, make a state estimated tax payment by September 15th as well.
If you don’t have enough money to pay the estimated taxes you owe, send in as much money as you can afford. Not filing estimated taxes when you should, will cost you a lot more in penalties than filing and paying less than you owe.
The deadline for the fourth quarter of estimated taxes is January 15th.
Note: You can make monthly, instead of quarterly, estimated tax payments. Doing so might be easier to budget than paying a larger amount quarterly. It may also be easier to remember to pay monthly. To set up a monthly payment, use the electronic Estimated Federal Tax Payment System (EFTPS).
Tom Copeland – www.tomcopelandblog.com
Image credit: https://www.dontmesswithtaxes.com/2018/04/revised-1040-es-takes-new-2018-tax-law-into-account.html
For details on how to fill out Form 1040ES, see my annual Family Child Care Tax Workbook and Organizer.
