Question

Estimated payments or increase withholdings

Forum|Forum|5 years ago
March 20, 2021
1 reply
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I filed my state taxes and paid $1080 because my state withholding was very low and we had a slight increase in income. TurboTax says that since I owed over $1000 for 2020, that I should pay 4 installments of estimated taxes for 2021 year. Our income will go up a bit but not into a new bracket. I have lots of room to increase my withholdings.

Rather than pay the installments, would it be Ok to increase my state withholdings this year? I’m assuming that “estimated payments” means that installments or withholdings are acceptable. I’d rather not have to hassle with remembering to pay the taxes. If there’s enough withholdings in the coming months, can I bypass the estimated payments?

Not A Product Question

SteamTrain

Employee

You sure can. Get a State withholding form from your payroll/HR and increase your State withholding from your employer. (Federal uses the form W-4, what the state calls their withholding forms varies )

You can submit it your employer...wait a month to see what the new state withholding ends up being....then change it again if needed. Keep a copy of the first one so that you know what to change....sometimes they also have a box for entering an exact additional $$ amount to withhold with each paycheck, and you can figure an approx. additional amount to have withheld with every paycheck for the rest of the year.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*