I'm unemployed and my 2024 income is very unpredictable so I'm having a hard time figuring out estimated tax.
I spent many hours filling out several worksheets for Fed and NY state estimated taxes, but in the end they aren't very reliable since my AGI is so up in the air.
Instead, I plan to just use this formula to determine if I owe estimated tax in Q1. Does this make sense?
Fed: [110% x 2023 Fed taxes] / 4
State: [110% x 2023 NY taxes] / 4
City: [110% x 2023 NYC taxes] / 4
Using this formula, I don't owe any estimated tax for Q1. But in subsequent quarters I would owe a LOT, because my 2023 AGI was very high and in Q2 this year I'll have almost $0 in withholding.
As an alternative, can I use the formula above for Q1 and the annualized method for Q2-Q4? Wasn't sure if you can change methods mid-year.
I spent many hours filling out several worksheets for Fed and NY state estimated taxes, but in the end they aren't very reliable since my AGI is so up in the air.
Instead, I plan to just use this formula to determine if I owe estimated tax in Q1. Does this make sense?
Fed: [110% x 2023 Fed taxes] / 4
State: [110% x 2023 NY taxes] / 4
City: [110% x 2023 NYC taxes] / 4
Using this formula, I don't owe any estimated tax for Q1. But in subsequent quarters I would owe a LOT, because my 2023 AGI was very high and in Q2 this year I'll have almost $0 in withholding.
As an alternative, can I use the formula above for Q1 and the annualized method for Q2-Q4? Wasn't sure if you can change methods mid-year.
Statistics: Posted by Aguilar — Mon Apr 15, 2024 2:40 pm — Replies 2 — Views 176