Level 6

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Estimated Business Taxes

Forum|Forum|4 years ago
February 22, 2022
3 replies
20 views

Well, here is another question for the day.

My client went independent last year as a counselor late in the year. His expectation for income is much different for 2022 so working through the estimated tax worksheet to get a sense of what he needs to set aside. Yet, the vouchers don't populate with any of his information. Am I missing a 'box'?

Also, if he needs to set aside 10k, does that all go aggregate to the IRS, and at the end of the year, that is divided amongst income tax, self-employment taxes, Medicare, etc?

Thank you.

p.s. Hoping ice isn't falling out of the sky wherever you are; as it is here in Northern Michigan today. 😉

ProSeries Basic

This topic has been closed for replies.

Best answer by qbteachmt

"Am I missing a 'box'?"

What about the entire financial picture?

"Also, if he needs to set aside 10k, does that all go aggregate to the IRS, and at the end of the year, that is divided amongst income tax, self-employment taxes, Medicare, etc?"

It's just Fed Tax Prepayment. It isn't divided or allocated.

If you have a W2 job and decide to use 0 withholding, you would pay Estimates if your financial picture requires it. If you have a W2 person and a Sched C person, the W2 person can increase their withholding to cover the family likely Fed Tax liability.

It's just a prepayment process against the entire 1040. Not using anything except the Sched C is not the full picture.

dkh

Level 15

I use PS Professional but I image your Estimated Tax Worksheet is the same. First, I would use the Tax Planner if Basic has it available. You can create 2022 projection then check box at bottom to have estimates calculate based on that projection. If Basic doesn't have be sure that in Part I the box 1b or 1c is checked to use 2022 estimated income. You can also check Part I line 3c to calculate regardless of amount.

Yes, it is all lumped together to cover total tax liability.

SensibleandHourlyAuthor

Level 6

Thank you! I found a brief estimated tax summary that I thought would transfer figures over to the vouchers, but, no, I still had to manually input line by line to create the vouchers. Then I found a 'what if' worksheet which goes into more detail for estimated taxes for future years, which I went through. Frustratingly, I can't make the two tools line up as far as the estimated 2022 tax, nor does the information link to the vouchers in any way that I can find. Gotta love technology. 😉

dkh

Level 15

I'm in northern Indiana - we're lucky, rain is falling from our sky - for now anyhow.

SensibleandHourlyAuthor

Level 6

Warm rain isn't so bad. 😉

qbteachmtAnswer

Level 15

"Am I missing a 'box'?"

What about the entire financial picture?

"Also, if he needs to set aside 10k, does that all go aggregate to the IRS, and at the end of the year, that is divided amongst income tax, self-employment taxes, Medicare, etc?"

It's just Fed Tax Prepayment. It isn't divided or allocated.

If you have a W2 job and decide to use 0 withholding, you would pay Estimates if your financial picture requires it. If you have a W2 person and a Sched C person, the W2 person can increase their withholding to cover the family likely Fed Tax liability.

It's just a prepayment process against the entire 1040. Not using anything except the Sched C is not the full picture.

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