Quote:
Originally Posted by petegz28
Follow me here....
Rolls over to Roth
Claims on tax returns
Tax return says you now owe $X
Pays tax bill for $X
Paying estimated taxes is just that, estimated. At the end of the day you have until April 15th of whatever year to true up what you owe or don't owe.
So why not leave the money he is going to pay the tax bill with in an account earning 4% for the year and then pay when he has too?
No one is going to come knocking on his door for any tax payment until April 16th, 2024.
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Buehler's right -- if the tax return says you now owe $X, and you have not paid 90% (I think that's it, in general) of $X by end of that tax year, you owe an underpayment penalty. If we didn't have that rule, then most people wouldn't want to withhold anything from their paychecks and all our self-employed people would wait to the last second to pay their taxes, thus depriving the IRS of what's rightfully theirs for nearly a year. (
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