No. of Recommendations: 0
This is a looooooong thread, but I seem to remember your wife saying she was setting aside some of her SE employment $ for taxes. That's important.

If one doesn't pay enough in one's quarterly estimated payments the IRS penalizes you, so that $ needs to be planned for. It can be planned for by taking it off the top and budgeting net, or it can be built into the budget. But you do need to do it.


Safe harbors for state income tax varies by state. They need to check for their state.

Since this is the first year that she has significant income, his withholding will likely be equivalent to 2011 income tax liability which is a safe harbor for federal income tax. Starting in April of 2013, estimated tax payments should be made.

The other item working in their favor for 2012 is that her income is starting late in the year. If any underpayment penalty (essentially interest) would be due, it would only be for part of the year.
Print the post  

Announcements

UGC Disclosure Notice Regarding Credit Card Posts
Community board discussions about credit cards are not provided or commissioned by banks who may have advertising relationships with The Motley Fool. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement