Good question. You may be required to be making quarterly estimates and failure to do so could result in penalties. I am going to answer this question with the most common answer from a CPA… – it depends.
You must pay taxes if:
- You are a sole proprietor, partner, S corporation and/or self employed and you expect to owe more than $1000 in taxes when you file
- You are a corporation and you expect to owe more than $500 in taxes when you file
- You had a tax liability in the prior year
You do not have to pay if you meet the following three conditions:
- You had no tax liability in the prior year
- You were a U.S. citizen or resident for the whole year
- Your prior tax year covered a 12-month period
Be sure to discuss your circumstances to your CPA to determine the amount you need to pay in your quarterly estimates.