What is estimated tax?
The definition of estimated tax is given by
the IRS. The IRS defines estimated tax as the method used
to pay tax on income that is not subject to income tax
What does estimated tax include?
Estimated tax includes:
income from self employment
gains from the sale of assets
prizes and awards
excess wages and salaries with not enough
What are estimated tax used for?
Estimated tax is used for paying income tax
and self employment tax as well as other taxes owed to the
I did not have enough tax withholding and
did not pay estimated tax, what happens?
If you did not have enough tax withheld and
you did not pay estimated tax throughout the year, then the IRS
can assess a penalty for not paying estimated tax and not
paying enough tax during the tax year.