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First year out of college (and my first paid jobs ever).

I worked at 3 different companies last year (2 as a full-time employee and 1 as an independent contractor (1099-MISC)).

Do I need to wait for my W-2 or do companies like Turbotax etc. auto import that stuff? Asking because I need to file it a bit early so that I can just directly pay the taxes instead of having to pay the quarterly estimate (I only got paid as an Independent Contractor after September so I didn't pay for that either).

2 Answers 2

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Companies like TurboTax can import data like W-2 if its available to them, but I believe entering the 1099-MISC is a manual operation.

Generally you should be paying estimated tax throughout the year to avoid penalty.

From IRS - Topic No. 306 Penalty for Underpayment of Estimated Tax:

Generally, most taxpayers will avoid this penalty if they either owe less than $1,000 in tax after subtracting their withholding and refundable credits, or if they paid withholding and estimated tax of at least 90% of the tax for the current year or 100% of the tax shown on the return for the prior year, whichever is smaller.

See: How do I estimate my taxes when I have only 1099 income?

As you have had W-2 wages, if the Federal withheld exceeds what you made in 2018 and it sounds like you earned $0 in 2018 you should be fine. If you had interest or dividend income in 2018, you should pay enough just to avoid penalty.

If your earnings are done via contracting and still continuing, you are correct about paying quarterly estimated tax payments.

Do realize that most US states have state income tax as well so plan for that.

Given that IRS instructions for Form 1040 for 2019 tax year are not going to available under after January 15 you may wish to wait to file your 2019 Federal Income Tax.

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  • I read the linked answer as the IRS will not even process any returns until Jan 27, so even if you do assume no rule changes and file ASAP, it wouldn't matter.
    – JPhi1618
    Commented Jan 10, 2020 at 19:31
  • Yes, but by preparing the forms you can see how much you owe in taxes total and go from there
    – xyious
    Commented Jan 10, 2020 at 20:06
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    Maybe I'm misreading it, but I think your quote is saying the opposite of what you want it to? There won't be a penalty in the cases you mentioned. Those aren't the cases where there is a penalty
    – Kat
    Commented Jan 10, 2020 at 20:17
  • @Kat I'm saying OP may wish to pay the quarterly estimated tax (and get in the habit if contract work continues) regardless of penalty or lack thereof for the 2019 tax year, but that due to IRS instructions/form delays wait to file 2019 income taxes. Commented Jan 10, 2020 at 20:29
  • I mean your quote in the quote block. Read it by itself. I couldn't find the quote on the link, so I'm not sure if it's missing context or if the original author got it backwards or what.
    – Kat
    Commented Jan 12, 2020 at 4:19
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Do I need to wait for my W-2 or do companies like Turbotax etc. auto import that stuff?

The tax software can import directly some W-2 data. It depends on what company you work for, and what payroll company they use. But even if the software can ingest the W-2 without you having to enter the numbers, it can't do that until the employer/payroll company releases the data. Some companies will be ready to go in early January, others will wait until the deadline of the end of January. In order for the tax software to get the data you will generally need some basic information like name, and social security number. They will also require you to enter a tracking number on the physical/electronic W-2. Of course you can't see that number until they generate the W-2.

Many tax payers can use the data on the last pay stub of the year to estimate the W-2 information. Though I have found that the presence of a HSA does make the mapping between the pay stub and the W-2 more complex if the company is also making a contribution.

New graduates with their first job generally have a low risk of federal penalties. Low income in 2018 makes it easy to meet the safe-harbor numbers for 2019. What complicates your situation, is the self-employment income. The company that hired you didn't withhold any federal, state, of FICA taxes. you will need to at least fill out the January 2020 estimated tax forms to see if you need to file one.

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