Question

Estimate Taxes for 2020

Forum|Forum|6 years ago
March 4, 2020
1 reply
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When doing the Estimated Taxes for 2020, the calculations must be off.

for 2019, Taxable income was 72000, Taxes 13700

for 2020, Taxes estimate around 66000, but projected Taxes according to TurboTax is $22000!!!!

What went wrong, check the calculation many times?

Thanks for helping out.

VictoriaD75

If your prior year Adjusted Gross Income was $150,000 or less, then you can avoid a penalty if you pay either 90 percent of this year's income tax liability or 100 percent of your income tax liability from last year (dividing what you paid last year into four quarterly payments). This rule helps if you have a big spike in income one year, say, because you sell an investment for a huge gain or win the lottery. If wage withholding for the year equals the amount of tax you owed in the previous year, then you wouldn't need to pay estimated taxes, no matter how much extra tax you owe on your windfall.

If your prior year's Adjusted Gross Income was greater than $150,000, then you must pay either 90 percent of this year's income tax liability or 110 percent of last year's income tax liability.

Refer to your tax liability on line 16 of your Form 1040 and estimate based on that amount. You can take into consideration any withholding that may be applied.

1040-ES

Estimated Taxes

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