Harlan Lunsford <lunstax[at]bellsouth.net> wrote:
- quote -

There's 2 ways to go. Either stick with withholding and
withhold enough in Dcember to pay either 100$ (or 120%) of
last year's tax, or 90% of what your 2004 taxes will be. OR
compute your minimum deposit to satisfy the form 2210
Annualized Income Method minimum payement with withholding
and an installment. TT can't do this (as you discovered)
but you can get a "2210 tax calculator" from someone on the
web. put that, or "tax installment calculator" into any
search engine.

good luck.

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axast[at]yahoo.com (A) posted:

- quote -

Just enough of the question to make the point that "program
filing" (a la Turbo) may constrict us. In the paper world,
one could file [at] 100%, then monitor and adjust *actual*
payments. If one has an unexpectedly great third quarter,
simply increase the Sep 15 estimated tax payment
accordingly.

Bill

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A wrote:

- quote -

Override the 1040es calculations and print the vouchers for
zero each. However IRS will probably send you your own
personalized set of vouchers. then you can use your
software to do the projections for each quarter and vary
your payments accordingly.

I do get the feeling though, that your taxes will be much
lower this year.

And it's no sin if you fall a tad short by next year.
After all, IRS underpayment interest rate of 5% isn't
exactly onerous these days.

Cheer$,
Harlan Lunsford, EA n LA

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My husband has a sole propreitorship(1099) in addition to
his regular (W2) job. I work too as a w2 employee. Although
our W2 incomes are pretty much fixed. But his business
income varies quite a bit every year. Last year (2003) just
happened to be a good one where he earned more money than we
anticipated. Actually the payments that were due in 2002, he
got those in 2003 and hence our income in 2003 increased
quite a bit. Instead of being happy about this, we are
disappointed, as turbo tax calculated our tax due to be
quite a bit this year...but we didn't incur any penalty as
we had paid 110% of estimated taxes.

The questions is if we go by the 110% of previous year
option for filing Estimated taxes for 2004, we are screwed
as our income was very high in 2003 and there is no way we
will be making that much this year and there is no way we
can make those kind of estimated payments (110% of 2003).
Another thing is this year (2004) we are expecting a baby.
Also I would be taking 3 months off from work under FMA to
stay at home after delivery. This means my total w2 income
would decrease for this year.

What should we do in this case. We are not in a position to
do estimated payments of 110% of 2003. Should we do 100% of
our projected 2004 earnings or 90%? What are the pros and
cons of each. Let's say we go by 100% of 2004 (which I
assume is still safer than 90%), would we incur any penalty?
What about penalty of underpayment in a quareter.

My husband and I would be getting a regular W2 paychecks for
the first quarter. we are expecting the baby around June
this year...so the W2 income would actually go down in
June,July,August and maybe September. As far as the business
income goes, it is very unpredictable....some months are
good...some are bad. What should we do...please advise?
Turbo tax just aloows us to split the 100% of 2004 taxes in
4 equal amounts...would we fall short for the 1st qaurter.
How can we remedy this.

TAX GURUS, PLEASE HELP !

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