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February 2, 2023
Question

Estimated Tax Payments on my taxes this year but I'm not self-employed, no interest income, no dividend income & I don't have stock or other assets or alimony. Why?

  • February 2, 2023
  • 1 reply
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I have multiple jobs and each place knows about the other. In 2022 my company was bought by another but I don't think that would have any impact. I live and work in California. I have not received a 1040-ES either

1 reply

February 2, 2023

did you use the multiple jobs worksheet to complete the w-4s for 2022?  if not, then it's likely there is underwithholding and that's the reason for the estimates - to avoid penalties in 2023 for not having enough withheld. you can submit new w-4s for 2023 to avoid estimates.

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you can also use the IRS tax withholding estimator

https://www.irs.gov/individuals/tax-withholding-estimator 

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to avoid penalties in 2023 and the paying of estimates the following is required.

There will be no federal penalties for underpaying taxes if federal withholding
1) equals or exceeds 90% of your 2022 tax or
2) equals or exceeds 100% of your 2022 tax (110% if your 2022 adjusted gross income was more than $150K) or
3) the balance due after subtracting taxes withheld from 90% of your 2023 tax is less than $1,000 or
4) your total taxes are less than $1,000

the lower of 1 or 2 is your required annual payment. under the simplified method for estimated tax penalties, usually, 2 is a better option because you never know for sure what your next year's taxes will be. 
state laws vary