Do I have to pay estimated tax?

Yes you because you will your self employment taxes social security and medicare tax on your NET profit amount from your schedule C and the SE of your 1040 income tax return during the 2013 tax filing season for this purpose.

Self-Employment Tax 2012 Calculator

Use this calculator to estimate your self-employment taxes for 2012. Normally these taxes are withheld by your employer. However, if you are self-employed, operate a farm or are a church employee you may owe self-employment taxes. This calculator uses 2012 tax tables and should not be used for estimating 2011 self-employment taxes.

(Please note that the 2012 self-employment tax is 10.4% for the FICA portion and 2.9% Medicare. The FICA rate was reduced from 12.4% to 10.4% through the end of 2012. The FICA portion of the self-employment tax will return to 12.4% in 2013.)

http://www.cpasitesolutions.com/content/calcs/TaxS...

Net PROFIT AMOUNT of 13000 your SE taxes.

Your self-employment tax is estimated at $1,596.73.

Your estimated self-employment taxes include $1,248.57 for FICA and $348.16 for Medicare. This was based on $12,005.50 of income subject to self-employment taxes. Your employment income of $0.00 reduced your FICA tax by $0.00. This included $0.00 withheld from your pay and $0.00 paid by your employer.

(Please note that the 2012 self-employment tax is 10.4% for the FICA portion and 2.9% Medicare. The FICA rate was reduced from 12.4% for to 10.4% through 2012. The FICA portion of the self-employment tax will return to 12.4% in 2013.)

Hope that you find the above enclosed information useful. 12/27/2014

Relax. It is now not that bad! When you file by January 15 and pay all that you just owe, you won't be penalized. Or in the event you owe lower than $a thousand, you won't be penalized. Or if you did not have any tax legal responsibility last 12 months, you is not going to be penalized, so feels like you are off the hook on that basis. Otherwise you'll be charged a penalty for now not submitting estimated taxes. The amount of the penalty would rely upon how a lot you owe, however until you owe countless numbers of dollars it is not going to be lots. You might have a couple extra quarterly deadlines for 2010 estimated taxes, in Sept and in January. You would be clever to make repayments then if you are going to owe a lot for the yr, and make better estimated repayments that you just'd customarily ship quarterly to make up for the two you didn't ship.

You forgot the self-employment tax. That adds up to $1,769 on $14,400 of net profit from self-employment. You should have been making quarterly payments of 1/4 of that if your business started before March, 2012 or 1/3 of that if it started in April, 2012.

Normally there is a penalty for underpayment of tax if you owe more than $1,000 at filing time, however the IRS waives that for the first year of self-employment. You still have to pay in full by April 15, 2013 to avoid any late payment penalties or interest.

Going forward, you will need to start making estimated payments for 2013 starting on April 15, 2013 based upon your projected income for 2013. Subsequent payments are due on June 15, September 15, and January 15, 2014.

Without knowing your other income and withholding, it is not possible to say if you are required to file estimated tax. Estimated tax is the difference between the total taxes you owe minus the withholding and other tax payments you have made. If your Estimated tax is more than $1,000, you must pay quarterly estimated tax in order to avoid underpayment penalties.

For example, I assume you have expenses to deduct, let's say you net $10,000 and you are in the 15% income tax bracket, and your withholding on your other job(s) pays the income tax on those wages. Then the taxes on the side business is about $3,000 (about 15% income tax and 15% self-employment tax). You should send in estimated tax payments of about $750 each quarter.

You can do a detailed analysis of your estimated tax by using the worksheets available in Pub 505. Do not deduct your standard deduction and exemptions from your side job and think you owe no estimated tax. These deductions reduce the total income, not your self-employment income.

Download and run through a Sch C to see what your net income is. After you subtract your business expenses from your gross income you will probably only net around seven to eight K; you will only be owing the 15.3% medicare and social security tax; and if you are between 25 and 65 you will have some EIC to reduce that. If you owe less than $ 1,000 you won't have any penalty so you can just file it and pay at that time.

Does your spouse work? If so, your calculation would have to include their income also.

Even if they don't work, the deductions and exemptions are only subtracted for calculating income tax, not self employment tax (social security and medicare). If the total tax will be over $1000, then yes you need to make estimated payments.

$14400 for 2012 for your Sch C net? yea you are three vouchers behind on paying at least your self employment tax

it is true you have the personal exemptions and standard deduction to reduce your AGI, but self employment tax is not included in that calculation

I can say sometimes when your earned income comes within the EIC limits that credit might actually pay your self employment tax but in your case, that is not clear

you have one last voucher due Jan. 17, 2013 to get your 2012 up to date(which doesn't mean you avoid any penalty since you have failed to file the other three)

If you seriously will only make 14,400 between you and your wife, for 2012, then yes, std deduction is about 12k and 3,800 per person. So about 19,600. That is more than 14,400 so you will owe nothing. But, if anyone can claim either one of you as a dependent, then this changes things. Also, You both make less than 19,100, so therefore you would qualify for the EIC, which means you will get a refundable credit.

If your net profit is 14,400, then you pay 1,900 in SE tax. But you have the EIC. The EIC in your situation is about $331. So maybe you would only owe about $1500

You fill out a schedule C and subtract your expenses. That is transferred to the 1040 and it is added to your spouses income. As long as you do not owe 1k or more at tax time you do not need to do estimates. You also fill out an SE form for self employment taxes which is 13.2%.

If you do not file estimated taxes and wait until you file the full annual return you will pay a penalty if you owe more then $1,000.