How to start

Forum|Forum|1 year ago
August 28, 2024
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I am working a W2 job and am starting to work an additional 1099 job, What are the first steps in beginning to pay quarterly taxes? Also do I pay SSA taxes, state and community takes as well as Federal taxes? I live in Ohio

dev145

First step is to estimate your quarterly income and expenses related to 1099 activity. Once you have estimated net amount, you can calculate qtr. taxes. Remember you will be paying not only federal tax but also Social Security and Medicare Tax (FICA Taxes) too. FICA tax rate is 15.3%. IRS has a worksheet to calculate estimated taxes. See below link.

https://www.irs.gov/pub/irs-pdf/f1040es.pdf

dev145

Once you have a rough estimate about your total income from side business, it's time to calculate estimate taxes. Yes ,you will pay FICA taxes along with federal, state and local (if applicable) taxes. TurboTax has tax calculator that you can use to get a estimated of total balance due for the year. If you have not filed your 2023 return yet, you can use software to generate vouchers for 2024. You can find You can find that section under Federal -> Other Tax Situations -> Other Tax Forms -> Form W-4 and Estimated Taxes - Click the Start or Update button.

TurboTax will ask you about your total income and withholding for 2024 and generate vouchers for you. If you have already filed the taxes, you can use TurboTax tax calculator to estimate balance due and use that number to make estimated payments for 3rd and 4th qtr. Make sure to report each type of income and any withholding from w2 job.

There are few ways you can pay estimated payments. You can pay directly on IRS website. You can pay via bank account, credit card. You can send IRS a check. See below link for more info.

https://www.irs.gov/filing/where-to-file-addresses-for-taxpayers-and-tax-professionals-filing-form-1040-es

Similarly, you can use TurboTax software to create voucher for state too if you have not filed 2023 return yet. Most state do offer online payment option for their website.

Thanks and hope that information I provided is helpful.