Calculating Tax Estimates

Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Tax Preparation Tips and other Taxes topics.

How do you calculate your estimated taxes?

Calculating Tax Estimates

In order to calculate your estimated taxes you can use your prior year adjusted gross income. Suppose it was less than $125,000 - then you can pay either 90 percent of this year's or 100 percent of last year's income tax liability. After you estimate your taxes for the term, make sure you divide this amount into fourths and pay appropriately. Note: If you are a farmer, change the 90 percent shown above to 66.67 percent. There are many different rules that apply to farmers so you might want to refer to IRS Publication 225: Farmer's Tax Guide.

   

Comments

Nobody has commented on this tip yet. Be the first.



Name:


URL: (optional)


Comment:


Not finding the advice and tips you need on this Taxes Tip Site? Request a Tip Now!


Guru Spotlight
Kristle Jones