Single
Married Filing Jointly
Married Filing Separately
Head of Household
Estimated Tax Liability
$0.00
Understanding Estimated Tax
Estimated tax is the method used to pay tax on income that is not subject to withholding. This typically includes income from self-employment, interest, dividends, rent, and alimony. If you receive income such as these throughout the year, you may need to make estimated tax payments to satisfy your tax obligation. Failure to do so could result in penalties.
Who Needs to Pay Estimated Taxes?
Generally, you need to pay estimated tax for the year if you expect to owe at least $1,000 in tax after subtracting your withholding and any refundable credits. This applies if you expect your withholding to be less than the smaller of:
90% of the tax to be shown on your current year's tax return, or
100% of the tax shown on your prior year's tax return (if your prior year return covered all 12 months).
For most taxpayers, this means if you expect to owe money to the IRS when you file your return, you should consider making estimated tax payments.
How Estimated Tax is Calculated
The calculation of estimated tax involves several steps:
Determine your expected Adjusted Gross Income (AGI): This is your gross income minus certain specific deductions.
Subtract your total deductions: You can either take the standard deduction (which varies by filing status) or itemize your deductions. For simplicity in this calculator, we ask for total deductions directly, assuming you've determined whether to itemize or take the standard deduction and have entered the higher of the two.
Calculate your taxable income: This is your AGI minus your total deductions.
Apply the appropriate tax brackets: The US uses a progressive tax system. Different portions of your taxable income are taxed at different rates (tax brackets). The tax rates depend on your filing status.
The tax brackets can change annually and are complex. For this calculator, we are using a simplified representation of the 2023 tax brackets for illustration. Consult IRS publications or a tax professional for precise, up-to-date figures.
Illustrative Tax Brackets (2023 – Simplified for Calculator)
Single: 10% on income up to $11,000; 12% on income between $11,001 and $44,725; 22% on income between $44,726 and $95,375; 24% on income between $95,376 and $182,100; 32% on income between $182,101 and $231,250; 35% on income between $231,251 and $578,125; 37% on income over $578,125.
Married Filing Jointly: 10% on income up to $22,000; 12% on income between $22,001 and $89,450; 22% on income between $89,451 and $190,750; 24% on income between $190,751 and $364,200; 32% on income between $364,201 and $462,500; 35% on income between $462,501 and $693,750; 37% on income over $693,750.
Married Filing Separately: Same as Single.
Head of Household: 10% on income up to $15,700; 12% on income between $15,701 and $59,850; 22% on income between $59,851 and $117,950; 24% on income between $117,951 and $190,750; 32% on income between $190,751 and $231,250; 35% on income between $231,251 and $578,125; 37% on income over $578,125.
Disclaimer: This calculator provides an estimation for educational purposes only. Tax laws are complex and subject to change. It does not account for all possible deductions, credits, or specific tax situations. Always consult with a qualified tax professional or refer to official IRS documentation for accurate tax advice.