side gig

Forum|Forum|1 year ago
August 28, 2024
2 replies
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I did the tax estimator including the information from my regular job last year (ie. box 1 and box 2), with one dependent child, plus other estimated income for the year (side gig with a 1096) With a tax credit for Residential clean energy credit, I don't believe I will have to pay extra taxes this year. Do I still need to pay the quarterly taxes?

Cindy4 12

If your income level gets to the point that you expect to owe more than $1,000 in taxes at end of the year you'll want to consider making an estimated payment to avoid penalty and interest.

Please be sure that the estimator included the Self-Employment tax for FICA- Social Security and Medicare- not just the income tax on your side gig earnings. To calculate this tax you would use 92.35% of your net earnings from self-employment and multiply it by 15.3%.

Hope this helps!

Cindy

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evelynm

Be sure your calculations/amount of credit is accurate if you decided not to remit estimated tax payments. You take the amount of your Residential Clean Energy Credit directly off your total tax, rather than as a deduction from your taxable income. If the credit exceeds the amount of ‌income tax you owe, the credit can take your liability to zero, but you can't use the credit to get an IRS refund. However, the unused portion of the credit will carry over to the following tax year.

Here is detailed information about the credit: Residential-Clean-Energy-Credit

Have an amazing day. Evelyn M (CPA 20+ years)I would love a thumbs up :) + Mark the post that answers your question by clicking on "Mark as Best Answer"