Self employed quarterly filing

Hello Quincy333, and thanks for your question!

You asked,"Who needs to file taxes for self employed quarterly tax & do you need to file if you have not worked in the last recent quarter ?"

Usually, if you operate as a small business owner or self-employed individual, it’s probable that you will need to make quarterly estimated tax payments. Generally, you are regarded as self-employed if you work in any of the following contexts:

• Independent contractor
• Sole proprietor
• Member of a partnership (such as an LLC) that receives guaranteed payments
• Someone who runs a business independently, even if it’s on a part-time basis

To determine whether you need to make quarterly estimated tax payments, the IRS applies a couple of guidelines:

1. You anticipate owing over $1,000 following the deduction of withholding and tax credits upon filing your tax return; or

2. You expect your tax credits and withholding to be lower than:

   a. 90% of your estimated tax obligation for the present tax year, or
   b. 100% of the prior tax year's liability, if it covers all 12 months of the calendar year.

These are commonly called safe harbor rules. If your adjusted gross income exceeds $150,000 ($75,000 if married and filing separately), the 100% requirement is raised to 110%.

Since you did not have any work in the last quarter you may be able to adjust or stop making estimated tax payments for that quarter, however, before skipping an estimated payment, you will want to estimate and consider your total income, deductions, and credits for the full year. If you expect your total tax liability for the year to be lower than the amount you have already paid in estimated taxes, and, if you expect to owe less than $1,000 in taxes for the year, you could adjust your next estimated tax payment to a lower amount or not make one all together, without being subject to the underpayment of estimated taxes penalty. 

For additional information please click on these links:

• A Guide to Paying Quarterly Taxes 
• How to Determine What to Pay and When for Estimated Taxes 

Please feel free to reach backout with any additional questions or concerns you might have!

Have an amazing rest of your day!

Terri Lynn, EA

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