3rd Quarter Estimated Tax Due 9/15

3rd Quarter Estimated Tax Due 9/15

September 15, 2021, is the deadline for third quarter estimated tax payments. This generally applies to people who are self-employed and some investors, retirees and those who may not normally have taxes withheld from their paycheck by their employers.

The U.S. tax system operates on a pay-as-you-go basis. This means taxpayers are to pay most of their tax during the year, as they earn or receive income. Therefore, individuals not subject to withholding may need to make quarterly estimated tax payments.

If a taxpayer underpaid their taxes, they may have to pay a penalty. This applies whether they paid through withholding or through estimated tax payments. A penalty may also apply for late estimated tax payments even if someone is due a refund when they file their tax return.

To figure estimated tax, an individual must figure their expected adjusted gross income (AGI), taxable income, taxes, deductions and credits for the year. When figuring 2021 estimated tax, it may be helpful to use income, deductions and credits for 2020 as a starting point.

If you would like to make sure your tax payments are still on track for your 2021 projected income, if your 2021 projected income has changed, or if you haven’t been working with PPG Partners on your quarterly estimated payments but would now like assistance determining how much you should pay in, please contact PPG Partners.