When I take on a client who is self-employed...or when a client becomes self-employed...if it appears the necessity exists for the client to make estimated payments, I dont wait for the client to tell me to set it up. No, because the client doesnt usually have any clue how these things work. I do it automatically, and then explain to the client how & went to write the checks. When preparing a tax return just now and seeing that a client with 100k in self-employment income only has a balance due of $600 (before Ive even put in expenses)...I had to take a look why. Its because LAST YEAR, I set him up to make estimates and that information carries forward in my software. So, now I get to call and ask: Did you make your estimated payments? If he did, he will be a happy guy. If he didnt, the IRS will penalize him for his failure. Yes, if you need to be making estimated payments and you dont, you will get penalized.
Posted on: Mon, 19 May 2014 17:12:21 +0000
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