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[[ We were too wise and overpaid our 98 taxes by $5000. Because we moved
overseas in '98, we've gotten extensions to meet the physical presence test for
the foreign income exclusion, meaning we won't actually be filing our '98 return
until September 99. But we owe estimated taxes for '99.]]

Ok...

[[ Our tax person here in HK says we don't need to meet the quarterly estimated
tax payment schedule as long as the IRS has our excess banked and that excess
is more than what our payments would be. In other words, say we owe $7,000
in estimated taxes for '99. She says we can skip the April 15 and July 15
payments. Just ignore them. Come October, we pay $250, and we'll owe
$1750 for Jan. 15 2000.]]

Correct...

[[ Does this sound right to y'all? ]]

Absolutely correct. I don't know if I would want Uncle Sammy to hold my money for almost nine months, but it is technically correct. You can, instead, apply only $1,750 to your first quarter estimate, have the remainder refunded, and pay your next three quarters as they are due.

[[I mean, since the IRS won't know it has an excess
for us until we file in Sept., can we be penalized for skipping our estimated tax
payments?]]

I see...you don't plan on filing until much later. Regardless, it's still correct.

[[ Do we owe the IRS some kind of notification or something? This all
strikes me as a bit too laissez faire...]]

No notification is required. When you finally file your tax return, you'll show the overpayment as being applied to your 1999 estimated taxes. That is the only reporting that you really need to do.

TMF Taxes
Roy
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