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Keep an Eye Out for Estimated Tax Payments

 

April 14, 2021

Estimated Payments CalendarThe word is out! The state of Indiana is moving the 2020 individual income tax filing deadline to May 17, 2021, to match the IRS. This also will allow you to make a payment with the tax return by the May 17, 2021 deadline, without owing any penalty or interest. But if you make estimated tax payments, don’t get your deadlines mixed up. The first quarterly estimated tax payment deadline has not changed. It is still April 15, 2021. Even If you are waiting until May 17, 2021 to file your 2020 individual tax return, you still need to make your first quarterly estimated tax payment by April 15, 2021.

What Are Estimated Tax Payments?

There’s no reason be scared of, or frustrated with, estimated tax payments. In fact, they can help you plan and organize. Estimated payments are a way to prepare ahead of time so you don’t get sticker shock when you file your tax return. These payments can help ease the burden of the tax bill a person may owe when filing a tax return. Certain people are required to make estimated income tax payments if they have an unpaid tax liability of $1000 or more. You should pay estimated tax if you expect to have income during the 2021 tax year that:

  • Will not have Indiana income taxes withheld, or
  • You think the amount withheld will not be enough to pay your tax liability, and
  • You expect to owe more than $1,000 when you file your tax return.

There are several ways you can make estimated tax payments. First, visit our website to get Form ES-40. Use the worksheet on Form ES-40 to see how much you will owe. Estimated Tax Payments are due periodically throughout the year. Due dates for the 2021 tax season are:

  • April 15, 2021 (1st installment)
  • June 15, 2021 (2nd installment)
  • Sept. 15, 2021 (3rd installment)
  • Jan. 18, 2022 (4th installment)

Not properly paying estimated tax is one of the most common errors made in filling Indiana tax returns. Unfortunately, there can be a penalty if they’re done incorrectly. If you make your estimated payments throughout the year and find out you’ve overpaid, no worries! You can apply some or all of the overpayment to the next year’s estimated tax payments, or get a refund.

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