Here’s what HIVE AI had to say about “Do I need to file quarterly estimated taxes in 2025?”:
Do I Need to File Quarterly Estimated Taxes in 2025?
Generally, the tax code requires taxpayers to pay federal income taxes as they earn income. To the extent these taxes are not withheld, a taxpayer must pay estimated income tax on a quarterly basis. Notice 2019–25
General Requirements for Estimated Tax Payments
You need to make quarterly estimated tax payments in 2025 if both of the following conditions apply:
- You expect to owe at least $1,000 in tax for 2025, after subtracting your withholding and refundable credits.
- You expect your withholding and refundable credits to be less than the smaller of: a. 90% of the tax to be shown on your 2025 tax return, or b. 100% of the tax shown on your 2024 tax return. Your 2024 tax return must cover all 12 months. IRS – Form 1040-ES (NR): U.S. Estimated Tax for Nonresident Alien Individuals
Estimated tax is a method used to pay tax on income that isn’t subject to withholding. This income includes self-employment income, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. IRS – Publication 554: Tax Guide for Seniors
Income tax is generally withheld from pensions and annuity payments you receive. However, if the tax withheld from your pension (or other) income isn’t enough, you may have to pay estimated tax. If you don’t pay enough tax through withholding, by making estimated tax payments, or both, you may be charged a penalty. IRS – Publication 554: Tax Guide for Seniors
Higher Income Taxpayers
If your adjusted gross income on your previous year’s return (2024) exceeded $150,000, the percentage for the second part of the test increases from 100% to 110% of the tax shown on your 2024 return. Notice 2019–25
Exceptions to the Estimated Tax Requirement
You don’t need to pay estimated tax if:
An addition to tax will not be imposed on an individual taxpayer if the taxpayer owes less than $1,000 in tax, after subtracting tax withheld on wages. Notice 2019–25
An individual will not be subject to an addition to tax if the individual did not have any tax liability for the previous year, the preceding taxable year was 12 months, and the individual was a citizen or resident of the United States throughout the preceding tax year. Notice 2019–25
If you file your 2024 Form 1040 or 1040-SR by March 3, 2025, and pay all the tax you owe at that time, you don’t need to make an estimated tax payment. IRS – Publication 505: Tax Withholding and Estimated Tax
Due Dates for Estimated Tax Payments
Section 6654 provides that, in the case of an individual, estimated income tax is required to be paid in four installments and the amount of any required installment is 25 percent of the required annual payment. Notice 2019–25
The due dates of the required installments for a calendar-year taxpayer are April 15, June 15, and September 15 of the calendar year in question and January 15 of the following year. Dawson U.S. Tax Court Opinions: Stewart Weston
For 2025, the specific due dates would be:
- First quarter: April 15, 2025
- Second quarter: June 16, 2025 (June 15 falls on a Sunday)
- Third quarter: September 15, 2025
- Fourth quarter: January 15, 2026
The deadline for the last quarterly estimated payment for the 2024 tax year is January 15, 2025. IRS Newsroom – IR-2024-311
Calculating Your Estimated Tax Payments
After you have figured your total estimated tax, figure how much you must pay by the due date of each payment period. You should pay enough by each due date to avoid a penalty for that period. If you don’t pay enough during any payment period, you may be charged a penalty even if you are due a refund when you file your tax return. IRS – Publication 505: Tax Withholding and Estimated Tax
If your first estimated tax payment is due April 15, 2025, you can figure your required payment for each period by dividing your annual estimated tax due by 4. IRS – Publication 505: Tax Withholding and Estimated Tax
Special Situations
For Married Couples Filing Separately
If taxpayers who filed a married filing jointly return for the prior tax year file married filing separately returns for the taxable year for which the estimated tax payments are being calculated, the regulations provide a special rule for calculating their required annual payments. Dawson U.S. Tax Court Opinions: James S. Plato
For Nonresident Aliens
A nonresident alien individual is required to make a payment of estimated tax if that individual’s gross income meets the requirements of section 6654. In making the determination under section 6654 as to whether the amount of the gross income of a nonresident alien individual is such as to require making a payment of estimated income tax, only the filing status relating to a single individual (other than a head of household) or to a married individual not entitled to file a joint return shall apply, unless an election is in effect for the taxable year under section 6013(g) or (h) and the regulations. Tresuary Reg. 1.6654-6
For Trusts and Estates
Per IRC 6654(I), new and existing trusts and estates must make quarterly estimated tax payments in the same manner as individuals, except an estate and certain grantor trusts exempt from making such payments during their first two taxable years. IRS IRM 21.7.4 Income Taxes/Information Returns
Generally, the estate or trust must make an estimated payment if it expects to owe at least $1,000 in tax during the taxable year and it expects the withholding and credits to be less than the smaller of:
- 90 percent of the tax shown on the tax return, or
- 100 percent of the tax shown of the prior year tax return (110 percent if the amount of the estate’s or trust’s AGI on that return is more the $150,000, and less than 2/3 of the gross income of the prior year is from farming or fishing). IRS IRM 21.7.4 Income Taxes/Information Returns
Penalties for Not Paying Estimated Tax
Section 6654(a) imposes an addition to tax for failure to make a sufficient and timely payment of estimated income tax. Notice 2019–25
An individual taxpayer will not be subject to the addition to tax if an exception or waiver provision applies. Notice 2019–25
Conclusion
Based on the provided information, you need to pay quarterly estimated taxes in 2025 if you expect to owe at least $1,000 in tax after subtracting withholding and credits, and your withholding and credits will be less than either 90% of your 2025 tax or 100% of your 2024 tax (110% if your 2024 AGI exceeded $150,000).
If you’re unsure whether you need to make estimated tax payments, consider using the Tax Withholding Estimator on IRS.gov to determine if your current withholding is sufficient or if you need to make additional payments to avoid an unexpected tax bill and potential penalties when filing your return.
Sources:
- IRS Notice 2019-25
- IRS Publication 505: Tax Withholding and Estimated Tax
- IRS Publication 554: Tax Guide for Seniors
- IRS Form 1040-ES (NR): U.S. Estimated Tax for Nonresident Alien Individuals
- IRS Internal Revenue Manual 21.7.4 Income Taxes/Information Returns
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