Estimated tax is the method used to pay tax on income that is not subject to withholding. This includes income from self-employment, interest, dividends, and rent, as well as gains from the sale of assets, prizes, and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough.

Both individuals and business owners may need to file and pay estimated taxes, which are paid quarterly. In 2018, the first estimated tax payment was due on April 18. If you do not pay enough by the due date of each payment period you may be charged a penalty even if you are due a refund when you file your tax return.

This newsletter article explains who has to pay estimated taxes and how the amounts and due dates are determined.

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Call your tax advisor at Sharrard, McGee & Co., PA if you have any questions about your individual or business estimated tax payments at (336) 884-0410 in High Point and (336) 272-9777 in Greensboro.