Connecticut residents who receive income throughout the year, regardless of its source, have to pay taxes on that income. In some instances, taxes are withheld before money is deposited into one’s bank account, but there are individuals who do not have taxes withheld. These individuals may have to pay an estimated income tax at various times throughout the year or possibly face penalties.
Those who may have to pay estimated taxes include business owners, partners, S corporation shareholders and contract workers — among others. They only have to pay the estimated tax if the amount they are expected to owe is over a certain amount — usually $1,000. There are certain forms one can use to determine if he or she must make estimated tax payments.
If one needs to make estimated tax payments, he or she will typically have to do it four times a year. The Internal Revenue Service publishes dates every year by which estimated payments must be submitted. Those required to make these payments may do so online, by mail or over the phone. Those who fail to pay on time may have to pay penalties. Those who do not pay estimated taxes at all may also be hit with fines.
Connecticut residents who have questions about estimated income tax should seek answers rather than letting it slide. Those who are facing penalties for failing to pay on time or at all can seek assistance to correct the situation. An experienced tax attorney would be a great resource whether one needs help figuring out his or her tax liability or addressing any mistakes previously made.