My wife collects some income in the form of royalties on a book. What I've read seems to indicate that we should try to estimate quarterly income and pay quarter-to-quarter. However, because her royalties can vary unpredictably as much as two orders of magnitude year to year, it would seem to be an onerous burden to try to estimate quarterly income from the royalties. We'd probably either drastically over estimate--over burdening ourselves with a large quarterly tax bill, or we'd under estimate--ending up penalized at tax time.
I would prefer a system whereby when we get a large royalty check, we immediately write a check for 1/3 or so to the IRS and consider that our estimated tax payment, then settle up at tax time. Is this reasonable? How would I do this? I can't seem to find any information on such a system--all I see is the information on estimating quarterly income for self employed individuals.
Whats the best course for someone who has sporadic, unpredictable income and they want to be sure to pay taxes on time?