Individual Estimated Taxes and Tax Planning Checkups

Tax and Money Tip of the Week
September 15, 2011 Tax Deadlines:
Individual Estimated Taxes and Tax Planning Checkups | August 3, 2011 | No. 54

This is the time of year in our CPA practice that I work with small business owners and individuals to perform tax checkups to help them project their tax liabilities for 2011 and make tax saving recommendations of moves they can make between now and December 31, 2011. Frequently, just defining the amount of taxes they owe via these planning services helps manage their cash flow so the businesses and individuals don’t have a big amount and/or surprise each Spring when they prepare their tax returns.

Coming up September 15, 2011 is the date in which the 3rd installment for individuals that have income that is not taxed and withheld (like W-2 income) is due.

Self employed businesses, e.g. Proprietor Schedule C filers, folks that own S Corporations, Partnerships, LLCs, or other flow-through entities must estimate their unpaid income and/or self-employment taxes for the period January 1-August 31, 2011 and pay ½ of this amount to IRS and/or NC Dept of Revenue on September 15, 2011 and the other ½ of this amount on or before January 15, 2012.  (April 15th and June 15th of each year are also Quarterly Estimated Tax Payment dates that have also passed by if you weren’t aware)

The rules for estimated tax payments depend on your modified adjusted gross income for 2011. “Safety” estimates can be designed to avoid penalties and interest, optimize cash flow, and save taxes. Call us for help.

There are existing tax laws that apply to estimated tax payments; next week we will cover these rules and how to optimize these rules and applicability to different income situations.
Questions or Comments?

You can add comments on the blog, call 919-847-2981, or visit our web site. We look forward to hearing from you.

Mark Vitek, CPA/PFS, CFP®

…until next week.

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