Full Time Job and Self Employment and a 1040ES

Question

Currently I am full time employed with a company, and am in the 25% tax bracket and claim no exemptions. I also have a website that I get ad revenue from.

Last year I had a few hundred dollars I owed to the federal government. I looked into the 1040 ES but didn't think that my revenue would change, but I changed ad providers at the end of March and now have earned almost half of what I earned in the entire year before.

I know that you should pay the 1040 ES quarterly, but it seems that I have missed the 1st one. So is there anything that I can do at this point to avoid penalties? Is it too late to file a 1040 ES?

Answer 1

You have most of the rest of the year to adjust your withholding from your regular paycheck.

If you adjust your withholding to make sure that this year more money is withheld this year than the amount of taxes from last year. See IRS Publication 17 for details:

Who Must Pay Estimated Tax

If you owe additional tax for 2012, you may have to pay estimated tax for 2013.

You can use the following general rule as a guide during the year to see if you will have enough withholding, or if you should increase your withholding or make estimated tax payments.

General rule. In most cases, you must pay estimated tax for 2013 if both of the following apply.

1. You expect to owe at least $1,000 in tax for 2013, after subtracting your 
   withholding and refundable credits.
2. You expect your withholding plus your refundable credits to be less than 
   the smaller of: 
    a. 90% of the tax to be shown on your 2013 tax return, or
    b. 100% of the tax shown on your 2012 tax return (but see Special rules 
       for farmers, fishermen, and higher income taxpayers, below). 
       Your 2012 tax return must cover all 12 months.