Keeping the Tax Underpayment Penalty at Bay

With the 2013 tax year behind you, now is the time to plan appropriately to make sufficient estimated tax payments. An underpayment of estimated tax may apply if you still owe $1,000 or more in additional tax after accounting for withholdings and estimated payments made throughout the year. Remember, to avoid underpayment penalties you are required to prepay either;

  • 90% of next year's tax obligation
  • * If your income is over $150,000 ($75,000 if married filing separate), you must pay 110% of last year’s tax obligation to be safe from an underpayment penalty.

    If you think you will need to make periodic payments to the IRS over the year to avoid the penalty, here are some pointers:

    If you have not already done so, please call to help assess your situation.

    Please give us a call to discuss these and other profit-boosting ideas for your business.

    DiSabatino CPA
    Michael DiSabatino
    651 Via Alondra Suite 715
    Camarillo, CA 93012
    Phone: 805-389-7300
    ww.sharpcpa.com

    This publication provides summary information regarding the subject matter at time of publishing. Please call with any questions on how this information may impact your situation. This material may not be published, rewritten or redistributed without permission, except as noted here.  All rights reserved.