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Author: allibaba Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121100  
Subject: Estimated Taxes Date: 7/20/1999 2:15 PM
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When do you need to start paying estimated taxes? Is there is a certain formula to figure this sort of thing out? I have never paid them before , but will be cashing in on some investments soon.

Thank you, Allibaba
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Author: edcosoft Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17523 of 121100
Subject: Re: Estimated Taxes Date: 7/20/1999 3:11 PM
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When do you need to start paying estimated taxes? Is there is a certain
formula to figure this sort of thing out? I have never paid them before , but
will be cashing in on some investments soon.

Thank you, Allibaba

Actually you almost never have to pay estimated taxes if you have a job. If your withholding is at least 100% of last year's taxes (105% if your AGI was over $150,000) you meet a "safe Harbor"--no penalty and pay your CG Taxes next April. If normal withholding is insufficient, boost it a bit, preferrably with one extra withholding in December.
NEXT YEAR, you'll notice, this won't work--you'll overpay unless you have another big gain, so meet the 90% of current year's taxes safe harbor instead. These safe harbors don't work unless you pay all withholding and/or 4 EQUAL AND ON TIME INSTALLMENTS. See Form 2210 and its Instructions for all the details.
AS a last resort, if the above doesn't work for some reason like an employer who can't read a W-4, send an installment for 20% (10% if you're in the 15% tax bracket) of your gain by the next quarterly installment date. Get a form 1040ES to accompany it. You'll have to compete the Form 2210 Annualized Method in this case, however, TurboTax will complete it for you. Ed

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Author: JoserFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17531 of 121100
Subject: Re: Estimated Taxes Date: 7/20/1999 7:06 PM
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Hello,
I plan to have federal withholding on my paycheck increased so that I meet the 100% of last year tax libiability so that I avoid the penalty. Do you know if there is a simiallr requirement for new York state? y situation is that my wife worked as an employee for half the year but is doing "sub-contracting" the second half of the year where no taxes are taken out for her. That's why I'll increase my federal withholding the second half of the year. If new york doesn't have a simiar withholding requirement I rather just pay extra state tax next April. (I'd rather use the money instead of let Uncle Sammy have use of it..but only if I don't get penalized for it)

Thanks for any help you can give!

Jose R Fool

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Author: edcosoft Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17534 of 121100
Subject: Re: Estimated Taxes Date: 7/20/1999 9:24 PM
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I really don't know about NY, but probably they require something similar to US. See if their tax form has a 2210--Penalty for underpayment of taxes. IF so, that's it. Probably similar rules to US. One of the garus from NY can tell you exactly . Ed

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Author: JoserFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17540 of 121100
Subject: Re: Estimated Taxes Date: 7/20/1999 10:39 PM
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Thanks for your help Ed! You are right New York has a similar form..it is IT-2105.9. Like the Federal Requirement you pay a penalty if you

1.) Don't have 100% of last year's liability withehld this year
OR
2.) Don't have at least 90% of what you owed in the current year

There is one more condition if you Owe less than $1000 federally there is no penalty. For New York state there is no penalty if you owe less than $100 to the state.

I found my information by looking at yahoo tax form category. You post helped me do a search on the correct wording once I got to the Tax form section.

Jose R Fool

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