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I'm trying to plan my taxes for 2018 (note, I have already filed taxes for 2017). I have about $5K of short term capital gains that have not had any tax withholding during the time Jan 1, 2018 - Mar 31, 2018 (as previously referenced here).

Based on the answers in the above-mentioned question, I plan to file Form 1040-ES before April 17 with estimated tax payments to the IRS, and I plan to file this form by hand. Since I live in MA, I expect I'll have to file Form 1-ES to file estimated tax payments to the State (can someone more knowledgeable than me please confirm or deny this?).

When I file my 2018 taxes next year (Form 1040), I plan to use TurboTax. Does anyone have experience using TurboTax after having filed 1040-ES by hand? Is it self-explanatory? I am trying to avoid paying underpayment penalties.

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I used Turbotax this year after manually making an estimated tax payment earlier in 2017.

Turbotax asks you "have you made any estimated tax payments". You tell it how much you paid. It reports the values on the 1040 appropriately.

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It's that easy.

There is a similar dialog for entering state estimated tax payments: enter image description here

This dialog is found as part of the deductions and credits for federal taxes, and then automatically brought forward to your state return.

  • That's great, thanks so much. What if you also paid the state (e.g., MA)? Was there a section for that? i.e., you sent a check to the IRS with Form 1040-ES, and sent the state a check with Form 1-ES (MA specific)? – David Apr 15 '18 at 16:44
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Not a Mass. resident but for estimated tax payments, Form 1-ES looks right to me.

To avoid any penalty you have to have estimated or withholding payments such that the total amount is less than $400 USD of your total tax liability for the tax year.

So either cut a check with Form 1-ES/1040-ES or have more money sent to the state/federal tax authorities via M-4/W-4 withholding.

Estimated payments are a standard part of TurboTax. I would advise searching the help for the exact place to enter such values.

  • Thanks -- do I cut one check with Form 1-ES and another check with form 1040-ES? – David Apr 15 '18 at 16:40
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    Yes. Federal and State are independent payees, so two checks. – Morrison Chang Apr 15 '18 at 17:03

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