What are estimated tax payments?
The IRS defines estimated tax “as the method used to pay tax on income that is not subject to withholding(for example, earnings from self-employment, interest, dividends, rents, alimony, etc.). You can still pay estimated taxes on other income that is subject to withholdings if you neglect to adjust those withholdings.
It is important to make these payments so that you do not incur underpayment penalties when filing your tax return. The IRS expects you to make timely payments. The purpose of filing the income tax return is to ensure that you have met this obligation and an amount due means that you did not. The underpayment penalty is discussed further in this blog post.
Estimated payments can be made online via the IRS website or can be mailed in using the Form 1040-ES.
There are rules to know if you should make estimated payments which include.
- You are expecting to owe at least $1,000 in tax for 2023.
- Your expected withholding and refundable credits are the smaller of the following:
- 90% of the taxes on your 2023 return.
- 100% of the tax shown on your 2022 tax return (which covers 12 months in 2022).
*Some special rules can apply if you are a farmer, fisher, or higher income taxpayer. Please refer to the instructions for Form 1040-ES.
Payment Due Dates
You should pay all of your estimated payments by April 18, 2023 or in four equal payments by the following dates:
Payment 1 | April 18, 2023 |
Payment 2 | June 15, 2023 |
Payment 3 | September 15, 2023 |
Payment 4 | January 16, 2024* *This payment can be skipped if you file your 2023 tax return by January 31, 2024 and pay the entire balance due. |
How to Make payments
Pay Online
Payments can be made online in your IRS account at this link.
Pay by Cash
Register to make a cash payment at https://fed.acipayonline.com/ The payments can then be made through retail partners at a maximum of $1000 per day per transaction.
Pay by Mobile Device
Download the IRS2Go app and make payments there.
Pay by Phone
ACI Payments, Inc. 888-UPAY-TAXTM (888-872-9829) fed.acipayonline.com
Link2Gov Corporation 888-PAY-1040TM (888-729-1040) www.PAY1040.com
WorldPay US, Inc. 844-PAY-TAX-8TM (844-729-8298) www.payUSAtax.com
Pay By Mail
You can pay by mail but must include the payment vouchers for each due date. The payment should be sent using a check or money order. Do not send cash through the mail. Make sure the payment voucher is completed including your name, address, and SSN(or ITIN). Make sure the payment amount is written. Make the check or money order payable to United States Treasury. Put “2023 Form 1040-ES and your SSN” on the check or money order.
Send payments here:
Pay using EFTPS
To get more information about EFTPS or to enroll in EFTPS, visit EFTPS.gov or call 800-555-4477. To contact EFTPS using Telecommunications Relay Services (TRS) for people who are deaf, hard of hearing, or have a speech disability, dial 711 and then provide the TRS assistant the 800-555-4477 number above or 800-733-4829. Additional information about EFTPS is also available in Pub. 966.