Why do I need to make estimated quarterly tax payments?
It is important to make quarterly estimated tax payments if you are self employed. The IRS believes that the tax system is a pay as you go system, meaning when you file your tax return in April, you should not owe any taxes. They should have previously been paid, whether through estimated tax payments or through withholding if you’re a wage earner. If you don’t make your quarterly estimated tax payments you could end up owing when you file your tax return in April, and then you would have to set up either a payment agreement with the IRS or pay the taxes in full to be in compliance.