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Tax preparation online Publication 557 - Introductory Material Table of Contents What's New Reminders Introduction What's New Proposed regulations on “good faith determinations”. Tax preparation online  Proposed regulations modify standards for making a good faith determination that a foreign organization is a charitable organization, grants to which may be qualifying distributions and not taxable expenditures. Tax preparation online The proposed regulations identify a broader class of tax practitioners upon whose written advice a private foundation may base a “good faith determination. Tax preparation online ” See, Proposed Regulations: Reliance Standards for Making Good Faith Determinations, REG-134974-12, 2012-47 I. Tax preparation online R. Tax preparation online B. Tax preparation online 553. Tax preparation online Prop. Tax preparation online Regs. Tax preparation online on Good Faith Determinations. Tax preparation online New Requirements for section 501(c)(3) Hospitals Under the Affordable Care Act. Tax preparation online  The Affordable Care Act (ACA), enacted March 23, 2010, added new requirements that hospital organizations must satisfy in order to be described in section 501(c)(3), as well as new reporting requirements and excise taxes. Tax preparation online On June 22, 2012, the Service issued a notice of proposed rulemaking that addresses the new requirements enacted by the ACA applicable to section 501(c)(3) hospital organizations. Tax preparation online See, Proposed Regulations: Additional Requirements for Charitable Hospitals, REG-13026-11, 77 Fed. Tax preparation online Reg. Tax preparation online 38148. Tax preparation online On April 3, 2013, the Service issued proposed regulations on the ACA's community health needs assessment (CHNA) requirements. Tax preparation online The proposed regulations also discuss the related reporting and excise tax requirements for charitable hospitals and the consequences for failure to satisfy the section 501(r) requirements. Tax preparation online See, Proposed Regulations: Community Health Needs Assessments for Charitable Hospitals, REG-106499-12, 78 Fed. Tax preparation online Reg. Tax preparation online 20,523. Tax preparation online Timing of when an Organization is exempt for Federal Tax Purposes. Tax preparation online  As noted in section 2. Tax preparation online 03(4) of Revenue Procedure 2013-9, 2013-2 I. Tax preparation online R. Tax preparation online B. Tax preparation online 267, the provisions in section 11. Tax preparation online 01 regarding the effect of determination letters or rulings recognizing exempt status of organizations described in section 501(c), other than sections 501(c)(3), (9), (17), and (29), have been revised. Tax preparation online Prior to this year, and back to 1962, when such organizations applied for recognition, the IRS would usually recognize the organizations as tax exempt from the date of formation, no matter how long the interval between the date of formation and the date of application. Tax preparation online In addition to the practical difficulties of ascertaining an organization's purposes and activities for this period, such recognition is now potentially inconsistent with the provisions of section 6033(j), which automatically revokes the exempt status of an organization that fails to file required Form 990 series returns or notices for three consecutive years. Tax preparation online The new procedure adopts a practice similar to the rule for section 501(c)(3) organizations for these organizations, generally permitting recognition from the date of formation if the organization has: always met the requirements for exemption, has applied within 27 months from the end of the month in which it was organized, and has not failed to file required Form 990 series returns or notices for three consecutive years. Tax preparation online Section 11. Tax preparation online 01(3) notes: an organization that otherwise meets the requirements for tax-exempt status and the issuance of a determination letter or ruling that does not meet the requirements for recognition from date of formation will generally be recognized from the postmark date of its application. Tax preparation online Exempt Organizations Select Check. Tax preparation online  The IRS has developed an on-line search tool, Exempt Organizations Select Check, that allows users to select an exempt organization and check certain information about its federal tax status and filings. Tax preparation online It consolidates three former search sites into one, providing expanded search capability and a more efficient way to search for organizations that: Are eligible to receive tax-deductible charitable contributions (Publication 78 data). Tax preparation online Users may rely on this list in determining deductibility of contributions, just as they did when Publication 78 was a separate electronic publication rather than part of Select Check. Tax preparation online Have had their tax-exempt status automatically revoked under the law because they have not filed Form 990 series returns or notices annually as required for three consecutive years (Auto-Revocation List). Tax preparation online Have filed a Form 990-N (e-Postcard) annual electronic notice. Tax preparation online  In addition to searching for a particular organization, users may download a complete list of each of the three types of organizations through Exempt Organizations Select Check. Tax preparation online See also Revenue Procedure 2011-33, 2011-25 I. Tax preparation online R. Tax preparation online B. Tax preparation online 887. Tax preparation online Future developments. Tax preparation online . Tax preparation online  The IRS has created a page on IRS. Tax preparation online gov for information about Publication 557, at www. Tax preparation online irs. Tax preparation online gov/pub557. Tax preparation online Information about any future developments affecting Publication 557 (such as legislation enacted after we release it) will be posted on that page. Tax preparation online Reminders The Patient Protection and Affordable Care Act (ACA). Tax preparation online   The ACA added several new laws. Tax preparation online This includes a new excise tax on indoor tanning services, a small business health care tax credit, additional requirements for tax-exempt hospitals, and the section 501(c)(29) CO-OP program. Tax preparation online For more information, go to IRS. Tax preparation online gov and select Affordable Care Act Tax Provisions. Tax preparation online Electronic filing requirement for large organizations. Tax preparation online  For tax years ending on or after December 31, 2006, only organizations that file 250 returns during the calendar year and that have total assets of $10 million or more are required to file Form 990 electronically. Tax preparation online For more information, go to e-file for Charities and Non-Profits. Tax preparation online Section 501(c)(15) gross receipts. Tax preparation online   The definition of gross receipts for purposes of determining whether small insurance companies qualify as tax-exempt under section 501(c)(15) has changed. Tax preparation online See Notice 2006-42, 2006-19 I. Tax preparation online R. Tax preparation online B. Tax preparation online 878, Notice 2006-42. Tax preparation online Prohibited tax shelter transactions. Tax preparation online  New excise taxes are imposed under section 4965 on certain tax-exempt organizations entering into prohibited tax shelter transactions. Tax preparation online See T. Tax preparation online D. Tax preparation online 9492, Excise Taxes on Prohibited Tax Shelter Transactions and Related Disclosure Requirements, 2010-33 I. Tax preparation online R. Tax preparation online B. Tax preparation online 242. Tax preparation online See IRS Issues Final Regulations Regarding Excise Taxes on Prohibited Tax Shelter Transactions and Related Disclosure Requirement. Tax preparation online Pension Protection Act of 2006 tax changes. Tax preparation online  The Pension Protection Act of 2006 made numerous changes to the tax law provisions affecting tax-exempt organizations. Tax preparation online Unless otherwise noted, most of the changes became effective on August 17, 2006. Tax preparation online For key provisions, go to The Pension Protection Act of 2006. Tax preparation online Section 501(c)(3) organizations must make their Form 990-T, Exempt Organization Business Tax Return (and proxy tax under section 6033(e)), open for public inspection for a period of 3 years from the date the Form 990-T is required to be filed (determined with regard to any extension of time for filing) or is actually filed, whichever is later. Tax preparation online There is an increase in excise taxes relating to public charities, social welfare organizations, and private foundations. Tax preparation online There are additional standards for credit counseling organizations. Tax preparation online The definition of convention or association of churches has been modified. Tax preparation online Entities that are not required to file Form 990 or 990-EZ must file new Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or 990-EZ. Tax preparation online The requirements of disclosure to state officials relating to exempt organizations has been modified. Tax preparation online There are excise taxes imposed on excess benefit transactions involving donor advised funds and sponsoring organizations. Tax preparation online There are new excise taxes on prohibited tax shelter transactions. Tax preparation online There is a modification of recordkeeping requirements for certain charitable contributions. Tax preparation online Introduction This publication discusses the rules and procedures for organizations that seek recognition of exemption from federal income tax under section 501(a) of the Internal Revenue Code (the Code). Tax preparation online It explains the procedures you must follow to obtain an appropriate ruling or determination letter recognizing your organization's exemption, as well as certain other information that applies generally to all exempt organizations. Tax preparation online To qualify for exemption under the Code, your organization must be organized for one or more of the purposes specifically designated in the Code. Tax preparation online Organizations that are exempt under section 501(a) include those organizations described in section 501(c). Tax preparation online Section 501(c) organizations are covered in this publication. Tax preparation online Chapter 1, Application, Approval, and Appeal Procedures, provides general information about the procedures for obtaining recognition of tax-exempt status. Tax preparation online Chapter 2, Filing Requirements and Required Disclosures, contains information about annual filing requirements and other matters that may affect your organization's tax-exempt status. Tax preparation online Chapter 3, Section 501(c)(3) Organizations, contains detailed information on various matters affecting section 501(c)(3) organizations, including a section on the determination of private foundation status. Tax preparation online Chapter 4, Other Section 501(c) Organizations, includes separate sections for specific types of organizations described in section 501(c). Tax preparation online Chapter 5, Excise Taxes, provides information on when excise taxes may be imposed. Tax preparation online Organizations not discussed in this publication. Tax preparation online   Certain organizations that may qualify for exemption are not discussed in this publication, although they are included in the Organization Reference Chart. Tax preparation online These organizations (and the Code sections that apply to them) are as follows. Tax preparation online Corporations organized under Acts of Congress 501(c)(1) Teachers' retirement fund associations 501(c)(11) Mutual insurance companies 501(c)(15) Corporations organized to finance crop operations 501(c)(16) Employee funded pension trusts (created before June 25, 1959) 501(c)(18) Withdrawal liability payment fund 501(c)(22) Veterans' organizations (created before 1880) 501(c)(23) National Railroad Retirement Investment Trust 501(c)(28) Religious and apostolic associations 501(d) Cooperative hospital service organizations 501(e) Cooperative service organizations of operating educational organizations 501(f)   Section 501(c)(24) organizations (section 4049 ERISA trusts) are neither discussed in the text nor listed in the Organization Reference Chart. Tax preparation online   Similarly, farmers' cooperative associations that qualify for exemption under section 521, qualified state tuition programs described in section 529, and pension, profit-sharing, and stock bonus plans described in section 401(a) are not discussed in this publication. Tax preparation online If you think your organization falls within one of these categories, contact the IRS for any additional information you need. Tax preparation online For telephone assistance, call 1-877-829-5500. Tax preparation online   Check the Table of Contents at the beginning of this publication to determine whether your organization is described in this publication. Tax preparation online If it is, read the chapter (or section) that applies to your type of organization for the specific information you must give when applying for recognition of exemption. Tax preparation online Organization Reference Chart. Tax preparation online   The Organization Reference Chart enables you to locate at a glance the section of the Code under which your organization might qualify for exemption. Tax preparation online It also shows the required application form and, if your organization meets the exemption requirements, the annual return to be filed (if any), and whether or not a contribution to your organization will be deductible by a donor. Tax preparation online It also describes each type of qualifying organization and the general nature of its activities. Tax preparation online   You may use the Organization Reference Chart to determine the Code section that you think applies to your organization. Tax preparation online Any correspondence with the IRS (in requesting forms or otherwise) will be expedited if you indicate in your correspondence the appropriate Code section. Tax preparation online Check the IRS website, IRS. Tax preparation online gov, for the latest updates, Tax Information for Charities & Other Non-Profits, www. Tax preparation online irs. Tax preparation online gov/charities/index. Tax preparation online html. Tax preparation online Comments and suggestions. Tax preparation online   We welcome your comments about this publication and your suggestions for future editions. Tax preparation online   You can e-mail us while visiting our website at IRS. Tax preparation online gov. Tax preparation online   You can send your comments to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Tax preparation online NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Tax preparation online Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Tax preparation online   If you wish telephone assistance, please call 1-877-829-5500. Tax preparation online This toll-free telephone service is available Monday through Friday. Tax preparation online Prev  Up  Next   Home   More Online Publications
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Tax preparation online 2. Tax preparation online   Estimated Tax for 2014 Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Who Does Not Have To Pay Estimated Tax Who Must Pay Estimated TaxGeneral Rule Married Taxpayers Special Rules Aliens Estates and Trusts How To Figure Estimated Tax2014 Estimated Tax Worksheet When To Pay Estimated TaxWhen To Start Farmers and Fishermen How To Figure Each PaymentRegular Installment Method Annualized Income Installment Method Estimated Tax Payments Not Required How To Pay Estimated TaxCredit an Overpayment Pay Online Pay by Phone Pay by Check or Money Order Using the Estimated Tax Payment Voucher Introduction Estimated tax is the method used to pay tax on income that is not subject to withholding. Tax preparation online This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. Tax preparation online You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough. Tax preparation online Estimated tax is used to pay both income tax and self-employment tax, as well as other taxes and amounts reported on your tax return. Tax preparation online If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. Tax preparation online If you do not pay enough by the due date of each payment period (see When To Pay Estimated Tax , later), you may be charged a penalty even if you are due a refund when you file your tax return. Tax preparation online For information on when the penalty applies, see chapter 4. Tax preparation online It would be helpful for you to have a copy of your 2013 tax return and an estimate of your 2014 income nearby while reading this chapter. Tax preparation online Topics - This chapter discusses: Who must pay estimated tax, How to figure estimated tax (including illustrated examples), When to pay estimated tax, How to figure each payment, and How to pay estimated tax. Tax preparation online Useful Items - You may want to see: Form (and Instructions) 1040-ES Estimated Tax for Individuals See chapter 5 for information about how to get this publication and form. Tax preparation online Worksheets. Tax preparation online   You may need to use several of the blank worksheets included in this chapter. Tax preparation online See Worksheets for Chapter 2, later, to locate what you need. Tax preparation online Who Does Not Have To Pay Estimated Tax If you receive salaries and wages, you may be able to avoid paying estimated tax by asking your employer to take more tax out of your earnings. Tax preparation online To do this, file a new Form W-4 with your employer. Tax preparation online See chapter 1. Tax preparation online Estimated tax not required. Tax preparation online   You do not have to pay estimated tax for 2014 if you meet all three of the following conditions. Tax preparation online You had no tax liability for 2013. Tax preparation online You were a U. Tax preparation online S. Tax preparation online citizen or resident alien for the whole year. Tax preparation online Your 2013 tax year covered a 12-month period. Tax preparation online   You had no tax liability for 2013 if your total tax (defined later under Total tax for 2013—line 14b ) was zero or you did not have to file an income tax return. Tax preparation online Please click here for the text description of the image. Tax preparation online Figure 2-A: Do You Have To Pay Estimated Tax? Who Must Pay Estimated Tax If you owed additional tax for 2013, you may have to pay estimated tax for 2014. Tax preparation online You can use the following general rule as a guide during the year to see if you will have enough withholding, or should increase your withholding or make estimated tax payments. Tax preparation online General Rule In most cases, you must pay estimated tax for 2014 if both of the following apply. Tax preparation online You expect to owe at least $1,000 in tax for 2014, after subtracting your withholding and refundable credits. Tax preparation online You expect your withholding and refundable credits to be less than the smaller of: 90% of the tax to be shown on your 2014 tax return, or 100% of the tax shown on your 2013 tax return. Tax preparation online Your 2013 tax return must cover all 12 months. Tax preparation online Note. Tax preparation online The percentages in (2a) or (2b) above may be different if you are a farmer, fisherman, or higher income taxpayer. Tax preparation online See Special Rules , later. Tax preparation online If the result from using the general rule above suggests that you will not have enough withholding, complete the 2014 Estimated Tax Worksheet for a more accurate calculation. Tax preparation online Figure 2-A takes you through the general rule. Tax preparation online You may find this helpful in determining if you must pay estimated tax. Tax preparation online If all your income will be subject to income tax withholding, you probably do not need to pay estimated tax. Tax preparation online Example 1. Tax preparation online Jane Smart uses Figure 2-A and the following information to figure whether she should pay estimated tax for 2014. Tax preparation online She files as head of household claiming her dependent son, takes the standard deduction, and expects no refundable credits for 2014. Tax preparation online Expected adjusted gross income (AGI) for 2014 $82,800 AGI for 2013 $73,700 Total tax on 2013 return (Form 1040,  line 61) $  8,746 Total 2014 estimated tax (line 13c of the 2014 Estimated Tax Worksheet) $11,015 Tax expected to be withheld in 2014 $10,000 Jane's answer to Figure 2-A, box 1, is YES; she expects to owe at least $1,000 for 2014 after subtracting her withholding from her expected total tax ($11,015 − $10,000 = $1,015). Tax preparation online Her answer to box 2a is YES; she expects her income tax withholding ($10,000) to be at least 90% of the tax to be shown on her 2014 return ($11,015 × 90% = $9,913. Tax preparation online 50). Tax preparation online Jane does not need to pay estimated tax. Tax preparation online Example 2. Tax preparation online The facts are the same as in Example 1, except that Jane expects only $8,700 tax to be withheld in 2014. Tax preparation online Because that is less than $9,913. Tax preparation online 50, her answer to box 2a is NO. Tax preparation online Jane's answer to box 2b is also NO; she does not expect her income tax withholding ($8,700) to be at least 100% of the total tax shown on her 2013 return ($8,746). Tax preparation online Jane must increase her withholding or pay estimated tax for 2014. Tax preparation online Example 3. Tax preparation online The facts are the same as in Example 2, except that the total tax shown on Jane's 2013 return was $8,600. Tax preparation online Because she expects to have more than $8,600 withheld in 2014 ($8,700), her answer to box 2b is YES. Tax preparation online Jane does not need to pay estimated tax for 2014. Tax preparation online Married Taxpayers If you qualify to make joint estimated tax payments, apply the rules discussed here to your joint estimated income. Tax preparation online You and your spouse can make joint estimated tax payments even if you are not living together. Tax preparation online However, you and your spouse cannot make joint estimated tax payments if: You are legally separated under a decree of divorce or separate maintenance, You and your spouse have different tax years, Either spouse is a nonresident alien (unless that spouse elected to be treated as a resident alien for tax purposes). Tax preparation online See Choosing Resident Alien Status in Publication 519, or Individuals of the same sex and opposite sex who are in registered domestic partnerships, civil unions, or other similar formal relationships that are not marriages under state law cannot make joint estimated tax payments. Tax preparation online These individuals can take credit only for the estimated tax payments that he or she made. Tax preparation online If you and your spouse cannot make joint estimated tax payments, apply these rules to your separate estimated income. Tax preparation online Making joint or separate estimated tax payments will not affect your choice of filing a joint tax return or separate returns for 2014. Tax preparation online 2013 separate returns and 2014 joint return. Tax preparation online   If you plan to file a joint return with your spouse for 2014, but you filed separate returns for 2013, your 2013 tax is the total of the tax shown on your separate returns. Tax preparation online You filed a separate return if you filed as single, head of household, or married filing separately. Tax preparation online 2013 joint return and 2014 separate returns. Tax preparation online   If you plan to file a separate return for 2014, but you filed a joint return for 2013, your 2013 tax is your share of the tax on the joint return. Tax preparation online You file a separate return if you file as single, head of household, or married filing separately. Tax preparation online   To figure your share of the tax on a joint return, first figure the tax both you and your spouse would have paid had you filed separate returns for 2013 using the same filing status for 2014. Tax preparation online Then multiply the tax on the joint return by the following fraction. Tax preparation online      The tax you would have paid had you filed a separate return   The total tax you and your spouse would have paid had you filed separate returns Example. Tax preparation online Joe and Heather filed a joint return for 2013 showing taxable income of $48,500 and a tax of $6,386. Tax preparation online Of the $48,500 taxable income, $40,100 was Joe's and the rest was Heather's. Tax preparation online For 2014, they plan to file married filing separately. Tax preparation online Joe figures his share of the tax on the 2013 joint return as follows: Tax on $40,100 based on separate return $5,960 Tax on $8,400 based on separate return 843 Total $6,803 Joe's percentage of total ($5,960 ÷ $6,803) 87. Tax preparation online 6% Joe's share of tax on joint return  ($6,386 × 87. Tax preparation online 6%) $5,594 Special Rules There are special rules for farmers, fishermen, and certain higher income taxpayers. Tax preparation online Farmers and Fishermen If at least two-thirds of your gross income for 2013 or 2014 is from farming or fishing, substitute 662/3% for 90% in (2a) under General Rule , earlier. Tax preparation online Gross income. Tax preparation online   Your gross income is all income you receive in the form of money, goods, property, and services that is not exempt from tax. Tax preparation online To determine whether two-thirds of your gross income for 2013 was from farming or fishing, use as your gross income the total of the income (not loss) amounts. Tax preparation online Joint returns. Tax preparation online   On a joint return, you must add your spouse's gross income to your gross income to determine if at least two-thirds of your total gross income is from farming or fishing. Tax preparation online Gross income from farming. Tax preparation online   This is income from cultivating the soil or raising agricultural commodities. Tax preparation online It includes the following amounts. Tax preparation online Income from operating a stock, dairy, poultry, bee, fruit, or truck farm. Tax preparation online Income from a plantation, ranch, nursery, range, orchard, or oyster bed. Tax preparation online Crop shares for the use of your land. Tax preparation online Gains from sales of draft, breeding, dairy, or sporting livestock. Tax preparation online   For 2013, gross income from farming is the total of the following amounts. Tax preparation online Schedule F (Form 1040), Profit or Loss From Farming, line 9. Tax preparation online Form 4835, Farm Rental Income and Expenses, line 7. Tax preparation online Your share of the gross farming income from a partnership, S corporation, estate or trust, from: Schedule K-1 (Form 1065), Schedule K-1 (Form 1120S), or Schedule K-1 (Form 1041). Tax preparation online Your gains from sales of draft, breeding, dairy, or sporting livestock shown on Form 4797, Sales of Business Property. Tax preparation online   Wages you receive as a farm employee and wages you receive from a farm corporation are not gross income from farming. Tax preparation online Gross income from fishing. Tax preparation online   This is income from catching, taking, harvesting, cultivating, or farming any kind of fish, shellfish (for example, clams and mussels), crustaceans (for example, lobsters, crabs, and shrimp), sponges, seaweeds, or other aquatic forms of animal and vegetable life. Tax preparation online   Gross income from fishing includes the following amounts. Tax preparation online Schedule C (Form 1040), Profit or Loss From Business. Tax preparation online Income for services as an officer or crew member of a vessel while the vessel is engaged in fishing. Tax preparation online Your share of the gross fishing income from a partnership, S corporation, estate or trust, from: Schedule K-1 (Form 1065), Schedule K-1 (Form 1120S), or Schedule K-1 (Form 1041). Tax preparation online Certain taxable interest and punitive damage awards received in connection with the Exxon Valdez litigation. Tax preparation online Income for services normally performed in connection with fishing. Tax preparation online Services normally performed in connection with fishing include: Shore service as an officer or crew member of a vessel engaged in fishing, and Services that are necessary for the immediate preservation of the catch, such as cleaning, icing, and packing the catch. Tax preparation online Higher Income Taxpayers If your AGI for 2013 was more than $150,000 ($75,000 if your filing status for 2014 is married filing a separate return), substitute 110% for 100% in (2b) under General Rule , earlier. Tax preparation online For 2013, AGI is the amount shown on Form 1040, line 37; Form 1040A, line 21; and Form 1040EZ, line 4. Tax preparation online Note. Tax preparation online This rule does not apply to farmers and fishermen. Tax preparation online Aliens Resident and nonresident aliens also may have to pay estimated tax. Tax preparation online Resident aliens should follow the rules in this publication, unless noted otherwise. Tax preparation online Nonresident aliens should get Form 1040-ES (NR), U. Tax preparation online S. Tax preparation online Estimated Tax for Nonresident Alien Individuals. Tax preparation online You are an alien if you are not a citizen or national of the United States. Tax preparation online You are a resident alien if you either have a green card or meet the substantial presence test. Tax preparation online For more information about withholding, the substantial presence test, and Form 1040-ES (NR), see Publication 519. Tax preparation online Estates and Trusts Estates and trusts also must pay estimated tax. Tax preparation online However, estates (and certain grantor trusts that receive the residue of the decedent's estate under the decedent's will) are exempt from paying estimated tax for the first 2 years after the decedent's death. Tax preparation online Estates and trusts must use Form 1041-ES, Estimated Income Tax for Estates and Trusts, to figure and pay estimated tax. Tax preparation online How To Figure Estimated Tax To figure your estimated tax, you must figure your expected AGI, taxable income, taxes, deductions, and credits for the year. Tax preparation online When figuring your 2014 estimated tax, it may be helpful to use your income, deductions, and credits for 2013 as a starting point. Tax preparation online Use your 2013 federal tax return as a guide. Tax preparation online You can use Form 1040-ES to figure your estimated tax. Tax preparation online Nonresident aliens use Form 1040-ES (NR) to figure estimated tax. Tax preparation online You must make adjustments both for changes in your own situation and for recent changes in the tax law. Tax preparation online Some of these changes are discussed under What's New for 2014 , earlier. Tax preparation online For information about these and other changes in the law, visit the IRS website at IRS. Tax preparation online gov. Tax preparation online The instructions for Form 1040-ES include a worksheet to help you figure your estimated tax. Tax preparation online Keep the worksheet for your records. Tax preparation online 2014 Estimated Tax Worksheet Use Worksheet 2-1 to help guide you through the information about completing the 2014 Estimated Tax Worksheet. Tax preparation online You can also find a copy of the worksheet in the Instructions for Form 1040-ES. Tax preparation online Expected AGI—Line 1 Your expected AGI for 2014 (line 1) is your expected total income minus your expected adjustments to income. Tax preparation online Total income. Tax preparation online   Include in your total income all the income you expect to receive during the year, even income that is subject to withholding. Tax preparation online However, do not include income that is tax exempt. Tax preparation online   Total income includes all income and loss for 2014 that, if you had received it in 2013, would have been included on your 2013 tax return in the total on line 22 of Form 1040, line 15 of Form 1040A, or line 4 of Form 1040EZ. Tax preparation online Social security and railroad retirement benefits. Tax preparation online If you expect to receive social security or tier 1 railroad retirement benefits during 2014, use Worksheet 2-2 to figure the amount of expected taxable benefits you should include on line 1. Tax preparation online Adjustments to income. Tax preparation online   Be sure to subtract from your expected total income all of the adjustments you expect to take on your 2014 tax return. Tax preparation online Self-employed. Tax preparation online If you expect to have income from self-employment, use Worksheet 2-3 to figure your expected self-employment tax and your allowable deduction for self-employment tax. Tax preparation online Include the amount from Worksheet 2-3 in your expected adjustments to income. Tax preparation online If you file a joint return and both you and your spouse have net earnings from self-employment, each of you must complete a separate worksheet. Tax preparation online Expected Taxable Income— Lines 2–5 Reduce your expected AGI for 2014 (line 1) by either your expected itemized deductions or your standard deduction and by your exemptions (lines 2 through 5). Tax preparation online Itemized deductions—line 2. Tax preparation online   If you expect to claim itemized deductions on your 2014 tax return, enter the estimated amount on line 2. Tax preparation online   Itemized deductions are the deductions that can be claimed on Schedule A (Form 1040). Tax preparation online    For 2014, your total itemized deductions may be reduced if your AGI is more than the amount shown next for your filing status. Tax preparation online Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than this amount, use Worksheet 2-5 to figure the amount to enter on line 2. Tax preparation online Standard deduction—line 2. Tax preparation online   If you expect to claim the standard deduction on your 2014 tax return, enter the amount on line 2. Tax preparation online Use Worksheet 2-4 to figure your standard deduction. Tax preparation online No standard deduction. Tax preparation online   The standard deduction for some individuals is zero. Tax preparation online Your standard deduction will be zero if you: File a separate return and your spouse itemizes deductions, Are a dual-status alien, or File a return for a period of less than 12 months because you change your accounting period. Tax preparation online Exemptions—line 4. Tax preparation online   After you have subtracted either your expected itemized deductions or your standard deduction from your expected AGI, reduce the amount remaining by $3,950 for each exemption you expect to take on your 2014 tax return. Tax preparation online If another person (such as your parent) can claim an exemption for you on his or her tax return, you cannot claim your own personal exemption. Tax preparation online This is true even if the other person will not claim your exemption or the exemption will be reduced or eliminated under the phaseout rule. Tax preparation online    For 2014, your deduction for personal exemption is reduced if your AGI is more than the amount shown next for your filing status. Tax preparation online Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than this amount, use Worksheet 2-6 to figure the amount to enter on line 4. Tax preparation online Expected Taxes and Credits— Lines 6–13c After you have figured your expected taxable income (line 5), follow the steps next to figure your expected taxes, credits, and total tax for 2014. Tax preparation online Most people will have entries for only a few of these steps. Tax preparation online However, you should check every step to be sure you do not overlook anything. Tax preparation online Step 1. Tax preparation online   Figure your expected income tax (line 6). Tax preparation online Generally, you will use the 2014 Tax Rate Schedules, later, to figure your expected income tax. Tax preparation online   However, see below for situations where you must use a different method to compute your estimated tax. Tax preparation online Tax on child's investment income. Tax preparation online   You must use a special method to figure tax on the income of the following children who have more than $2,000 of investment income. Tax preparation online Children under age 18 at the end of 2014. Tax preparation online The following children if their earned income is not more than half their support. Tax preparation online Children age 18 at the end of 2014. Tax preparation online Children who are full-time students over age 18 and under age 24 at the end of 2014. Tax preparation online See Publication 929, Tax Rules for Children and Dependents. Tax preparation online Although the ages and dollar amounts in the publication may be different in the 2014 revision, this reference will give you basic information for figuring the tax. Tax preparation online Tax on net capital gain. Tax preparation online   The regular income tax rates for individuals do not apply to a net capital gain. Tax preparation online Instead, your net capital gain is taxed at a lower maximum rate. Tax preparation online   The term “net capital gain” means the amount by which your net long-term capital gain for the year is more than your net short-term capital loss. Tax preparation online Tax on capital gain and qualified dividends. Tax preparation online If the amount on line 1 includes a net capital gain or qualified dividends, use Worksheet 2-7 to figure your tax. Tax preparation online Note. Tax preparation online For 2014, your capital gains and dividends rate will depend on your income. Tax preparation online Tax if excluding foreign earned income or excluding or deducting foreign housing. Tax preparation online If you expect to claim the foreign earned income exclusion or the housing exclusion or deduction on Form 2555 or Form 2555-EZ, use Worksheet 2-8 to figure your estimated tax. Tax preparation online Step 2. Tax preparation online   Total your expected taxes (line 8). Tax preparation online Include on line 8 the sum of the following. Tax preparation online Your tax on line 6. Tax preparation online Your expected alternative minimum tax (AMT) from Form 6251, or included on Form 1040A. Tax preparation online Your expected additional taxes from Form 8814, Parents' Election To Report Child's Interest and Dividends, and Form 4972, Tax on Lump-Sum Distributions. Tax preparation online Any recapture of education credits. Tax preparation online Step 3. Tax preparation online   Subtract your expected credits (line 9). Tax preparation online If you are using your 2013 return as a guide and filed Form 1040, your total credits for 2013 were shown on line 54. Tax preparation online If you filed Form 1040A, your total credits for 2013 were on line 34. Tax preparation online   If your credits on line 9 are more than your taxes on line 8, enter “-0-” on line 10 and go to Step 4. Tax preparation online Step 4. Tax preparation online   Add your expected self-employment tax (line 11). Tax preparation online You already should have figured your self-employment tax (see Self-employed under Expected AGI—Line 1, earlier). Tax preparation online Step 5. Tax preparation online   Add your expected other taxes (line 12). Tax preparation online   Other taxes include the following. Tax preparation online Additional tax on early distributions from: An IRA or other qualified retirement plan, A tax-sheltered annuity, or A modified endowment contract entered into after June 20, 1988. Tax preparation online Household employment taxes if: You will have federal income tax withheld from wages, pensions, annuities, gambling winnings, or other income, or You would be required to make estimated tax payments even if you did not include household employment taxes when figuring your estimated tax. Tax preparation online Amounts written on Form 1040 on the line for “other taxes” (line 60 on the 2013 Form 1040). Tax preparation online But, do not include recapture of a federal mortgage subsidy; tax on excess golden parachute payments; look-back interest due under section 167(g) or 460(b) of the Internal Revenue Code; excise tax on insider stock compensation from an expatriated corporation; uncollected social security and Medicare tax or RRTA tax on tips or group-term life insurance; or additional tax on advance payments of health coverage tax credit when not eligible. Tax preparation online Repayment of the first-time homebuyer credit. Tax preparation online See Form 5405. Tax preparation online Additional Medicare Tax. Tax preparation online A 0. Tax preparation online 9% Additional Medicare Tax applies to your combined Medicare wages and self-employment income and/or your RRTA compensation that exceeds the amount listed in the following chart, based on your filing status. Tax preparation online Filing Status Threshold Amount Married filing jointly $250,000 Married filing separately $125,000 Single $200,000 Head of household $200,000 Qualifying Widow(er) $200,000 Medicare wages and self-employment income are combined to determine if your income exceeds the threshold. Tax preparation online A self-employment loss should not be considered for purposes of this tax. Tax preparation online RRTA compensation should be separately compared to the threshold. Tax preparation online Your employer is responsible for withholding the 0. Tax preparation online 9% Additional Medicare Tax on Medicare wages or RRTA compensation it pays to you in excess of $200,000 in 2014. Tax preparation online You should consider this withholding, if applicable, in determining whether you need to make an estimated payment. Tax preparation online For more information on Additional Medicare Tax, go to IRS. Tax preparation online gov and enter “Additional Medicare Tax” in the search box. Tax preparation online Net Investment Income Tax (NIIT). Tax preparation online The NIIT is 3. Tax preparation online 8% of the lesser of your net investment income or the excess of your modified adjusted gross income over the amount listed in the following chart, based on your filing status. Tax preparation online Filing Status Threshold Amount Married filing jointly $250,000 Married filing separately $125,000 Single $200,000 Head of household $200,000 Qualifying Widow(er) $250,000 For more information on Net Investment Income Tax, go to IRS. Tax preparation online gov and enter “Net Investment Income Tax” in the search box. Tax preparation online Step 6. Tax preparation online   Subtract your refundable credit (line 13b). Tax preparation online   To figure your expected fuel tax credit, do not include fuel tax for the first three quarters of the year that you expect to have refunded to you. Tax preparation online   The result of steps 1 through 6 is your total estimated tax for 2014 (line 13c). Tax preparation online Required Annual Payment— Line 14c On lines 14a through 14c, figure the total amount you must pay for 2014, through withholding and estimated tax payments, to avoid paying a penalty. Tax preparation online General rule. Tax preparation online   The total amount you must pay is the smaller of: 90% of your total expected tax for 2014, or 100% of the total tax shown on your 2013 return. Tax preparation online Your 2013 tax return must cover all 12 months. Tax preparation online Special rules. Tax preparation online   There are special rules for higher income taxpayers and for farmers and fishermen. Tax preparation online Higher income taxpayers. Tax preparation online   If your AGI for 2013 was more than $150,000 ($75,000 if your filing status for 2014 is married filing separately), substitute 110% for 100% in (2) above. Tax preparation online This rule does not apply to farmers and fishermen. Tax preparation online For 2013, AGI is the amount shown on Form 1040, line 37; Form 1040A, line 21; and Form 1040EZ, line 4. Tax preparation online Example. Tax preparation online   Jeremy Martin's total tax on his 2013 return was $42,581, and his expected tax for 2014 is $71,253. Tax preparation online His 2013 AGI was $180,000. Tax preparation online Because Jeremy had more than $150,000 of AGI in 2013, he figures his required annual payment as follows. Tax preparation online He determines that 90% of his expected tax for 2014 is $64,128 (. Tax preparation online 90 × $71,253). Tax preparation online Next, he determines that 110% of the tax shown on his 2013 return is $46,839 (1. Tax preparation online 10 x $42,581). Tax preparation online Finally, he determines that his required annual payment is $46,839, the smaller of the two. Tax preparation online Farmers and fishermen. Tax preparation online   If at least two-thirds of your gross income for 2013 or 2014 is from farming or fishing, your required annual payment is the smaller of: 662/3% (. Tax preparation online 6667) of your total tax for 2014, or 100% of the total tax shown on your 2013 return. Tax preparation online (Your 2013 tax return must cover all 12 months. Tax preparation online )   For definitions of “gross income from farming” and “gross income from fishing,” see Farmers and Fishermen , under Special Rules discussed earlier. Tax preparation online Total tax for 2013—line 14b. Tax preparation online   Your 2013 total tax, if you filed Form 1040, is the amount on line 61 reduced by the following. Tax preparation online Unreported social security and Medicare tax or RRTA tax from Forms 4137 or 8919 (line 57). Tax preparation online The following amounts from Form 5329 included on line 58. Tax preparation online Any tax on excess contributions to IRAs, Archer MSAs, Coverdell education savings accounts, and health savings accounts. Tax preparation online Any tax on excess accumulations in qualified retirement plans. Tax preparation online The following write-ins on line 60. Tax preparation online Excise tax on excess golden parachute payments (identified as “EPP”). Tax preparation online Excise tax on insider stock compensation from an expatriated corporation (identified as “ISC”). Tax preparation online Look-back interest due under section 167(g) (identified as “From Form 8866”). Tax preparation online Look-back interest due under section 460(b) (identified as “From Form 8697”). Tax preparation online Recapture of federal mortgage subsidy (identified as “FMSR”). Tax preparation online Additional tax on advance payments of health coverage tax credit when not eligible (identified as “HCTC”). Tax preparation online Uncollected social security and Medicare tax or RRTA tax on tips or group-term life insurance (identified as “UT”). Tax preparation online Any refundable credit amounts. Tax preparation online   If you filed Form 1040A, your 2013 total tax is the amount on line 35 reduced by any refundable credits. Tax preparation online   If you filed Form 1040EZ, your 2013 total tax is the amount on line 10 reduced by the amount on line 8a. Tax preparation online Total Estimated Tax Payments Needed—Line 16a Use lines 15 and 16a to figure the total estimated tax you may be required to pay for 2014. Tax preparation online Subtract your expected withholding from your required annual payment (line 14c). Tax preparation online You usually must pay this difference in four equal installments. Tax preparation online See When To Pay Estimated Tax and How To Figure Each Payment . Tax preparation online You do not have to pay estimated tax if: Line 14c minus line 15 is zero or less, or Line 13c minus line 15 is less than $1,000. Tax preparation online Withholding—line 15. Tax preparation online   Your expected withholding for 2014 (line 15) includes the income tax you expect to be withheld from all sources (wages, pensions and annuities, etc. Tax preparation online ). Tax preparation online It includes excess social security, and tier 1 railroad retirement tax you expect to be withheld from your wages and compensation. Tax preparation online For this purpose, you will have excess social security or tier 1 railroad retirement tax withholding for 2014 only if your wages and compensation from two or more employers are more than $117,000. Tax preparation online See Excess Social Security or Railroad Retirement Tax Withholding in chapter 3. Tax preparation online   It also includes Additional Medicare Tax you expect to be withheld from your wages or compensation. Tax preparation online Your employer is responsible for withholding the 0. Tax preparation online 9% Additional Medicare Tax on Medicare wages or RRTA compensation it pays to you in excess of $200,000. Tax preparation online When To Pay Estimated Tax For estimated tax purposes, the year is divided into four payment periods. Tax preparation online Each period has a specific payment due date. Tax preparation online If you do not pay enough tax by the due date of each of the payment periods, you may be charged a penalty even if you are due a refund when you file your income tax return. Tax preparation online If a payment is mailed, the date of the U. Tax preparation online S. Tax preparation online postmark is considered the date of payment. Tax preparation online The payment periods and due dates for estimated tax payments are shown next. Tax preparation online For exceptions to the dates listed, see Saturday, Sunday, holiday rule below. Tax preparation online For the period: Due date: Jan. Tax preparation online 11 – March 31 April 15 April 1 – May 31 June 16 June 1 – August 31 September 15 Sept. Tax preparation online 1 – Dec. Tax preparation online 31 January 15  next year2 1If your tax year does not begin on January 1,  see Fiscal year taxpayers . Tax preparation online 2See January payment . Tax preparation online Saturday, Sunday, holiday rule. Tax preparation online   If the due date for an estimated tax payment falls on a Saturday, Sunday, or legal holiday, the payment will be on time if you make it on the next day that is not a Saturday, Sunday, or a holiday. Tax preparation online January payment. Tax preparation online   If you file your 2014 Form 1040 or Form 1040A by February 2, 2015, and pay the rest of the tax you owe, you do not need to make the payment due on January 15, 2015. Tax preparation online Example. Tax preparation online Janet Adams does not pay any estimated tax for 2014. Tax preparation online She files her 2014 income tax return and pays the balance due shown on her return on January 26, 2015. Tax preparation online Janet's estimated tax for the fourth payment period is considered to have been paid on time. Tax preparation online However, she may owe a penalty for not making the first three estimated tax payments, if required. Tax preparation online Any penalty for not making those payments will be figured up to January 26, 2015. Tax preparation online Fiscal year taxpayers. Tax preparation online   If your tax year does not start on January 1, your payment due dates are: The 15th day of the 4th month of your fiscal year, The 15th day of the 6th month of your fiscal year, The 15th day of the 9th month of your fiscal year, and The 15th day of the 1st month after the end of your fiscal year. Tax preparation online   You do not have to make the last payment listed above if you file your income tax return by the last day of the first month after the end of your fiscal year and pay all the tax you owe with your return. Tax preparation online When To Start You do not have to make estimated tax payments until you have income on which you will owe income tax. Tax preparation online If you have income subject to estimated tax during the first payment period, you must make your first payment by the due date for the first payment period. Tax preparation online You have several options when paying estimated taxes. Tax preparation online You can: apply an overpayment from the previous tax year, pay all your estimated tax by the due date of your first payment, or pay it in installments. Tax preparation online If you choose to pay in installments, make your first payment by the due date for the first payment period. Tax preparation online Make your remaining installment payments by the due dates for the later periods. Tax preparation online To avoid any estimated tax penalties, all installments must be paid by their due date and for the required amount. Tax preparation online No income subject to estimated tax during first period. Tax preparation online   If you do not have income subject to estimated tax until a later payment period, you must make your first payment by the due date for that period. Tax preparation online You can pay your entire estimated tax by the due date for that period or you can pay it in installments by the due date for that period and the due dates for the remaining periods. Tax preparation online Table 2-1 shows the dates for making installment payments. Tax preparation online    Table 2-1. Tax preparation online Due Dates for Estimated Tax Installment Payments If you first have income on which you must pay estimated tax: Make a payment  by:* Make later  installments  by:* Before April 1 April 15 June 16     Sept. Tax preparation online 15     Jan. Tax preparation online 15 next year April 1–May 31 June 16 Sept. Tax preparation online 15     Jan. Tax preparation online 15 next year June 1–Aug. Tax preparation online 31 Sept. Tax preparation online 15 Jan. Tax preparation online 15 next year After Aug. Tax preparation online 31 Jan. Tax preparation online 15 next year (None) *See January payment and Saturday, Sunday, holiday rule . Tax preparation online How much to pay to avoid penalty. Tax preparation online   To determine how much you should pay by each payment due date, see How To Figure Each Payment , later. Tax preparation online Farmers and Fishermen If at least two-thirds of your gross income for 2013 or 2014 is from farming or fishing, you have only one payment due date for your 2014 estimated tax, January 15, 2015. Tax preparation online The due dates for the first three payment periods, discussed under When To Pay Estimated Tax , earlier, do not apply to you. Tax preparation online If you file your 2014 Form 1040 by March 2, 2015, and pay all the tax you owe at that time, you do not need to make an estimated tax payment. Tax preparation online Fiscal year farmers and fishermen. Tax preparation online   If you are a farmer or fisherman, but your tax year does not start on January 1, you can either: Pay all your estimated tax by the 15th day after the end of your tax year, or File your return and pay all the tax you owe by the 1st day of the 3rd month after the end of your tax year. Tax preparation online How To Figure Each Payment After you have figured your total estimated tax, figure how much you must pay by the due date of each payment period. Tax preparation online You should pay enough by each due date to avoid a penalty for that period. Tax preparation online If you do not 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. Tax preparation online The penalty is discussed in chapter 4. Tax preparation online Regular Installment Method If your first estimated tax payment is due April 15, 2014, you can figure your required payment for each period by dividing your annual estimated tax due (line 16a of the 2014 Estimated Tax Worksheet (Worksheet 2-1)) by 4. Tax preparation online Enter this amount on line 17. Tax preparation online However, use this method only if your income is basically the same throughout the year. Tax preparation online Change in estimated tax. Tax preparation online   After you make an estimated tax payment, changes in your income, adjustments, deductions, credits, or exemptions may make it necessary for you to refigure your estimated tax. Tax preparation online Pay the unpaid balance of your amended estimated tax by the next payment due date after the change or in installments by that date and the due dates for the remaining payment periods. Tax preparation online If you do not receive your income evenly throughout the year, your required estimated tax payments may not be the same for each period. Tax preparation online See Annualized Income Installment Method . Tax preparation online Amended estimated tax. Tax preparation online If you refigure your estimated tax during the year, or if your first estimated tax payment is due after April 15, 2014, figure your required payment for each remaining payment period using Worksheet 2-14. Tax preparation online Example. Tax preparation online Early in 2014, Mira Roberts figures that her estimated tax due is $1,800. Tax preparation online She makes estimated tax payments on April 15 and June 16 of $450 each ($1,800 ÷ 4). Tax preparation online On July 10, she sells investment property at a gain. Tax preparation online Her refigured estimated tax is $4,100. Tax preparation online Her required estimated tax payment for the third payment period is $2,175, as shown in her filled-in Worksheet 2-14. Tax preparation online If Mira's estimated tax does not change again, her required estimated tax payment for the fourth payment period will be $1,025. Tax preparation online Worksheet 2-14. Tax preparation online Amended Estimated Tax Worksheet—Illustrated               1. Tax preparation online Amended total estimated tax due 1. Tax preparation online $4,100 2. Tax preparation online Multiply line 1 by:           50% (. Tax preparation online 50) if next payment is due June 16, 2014           75% (. Tax preparation online 75) if next payment is due September 15,  2014           100% (1. Tax preparation online 00) if next payment is due January 15,  2015 2. Tax preparation online 3,075     3. Tax preparation online Estimated tax payments for all previous periods 3. Tax preparation online 900     4. Tax preparation online Next required payment: Subtract line 3 from line 2 and enter the result (but not less than zero) here and on your payment voucher for your next required payment 4. Tax preparation online $2,175       Note. Tax preparation online If the payment on line 4 is due January 15, 2015, stop here. Tax preparation online Otherwise, go to line 5. Tax preparation online         5. Tax preparation online Add lines 3 and 4 5. Tax preparation online 3,075 6. Tax preparation online Subtract line 5 from line 1 and enter the result (but not less than zero) 6. Tax preparation online 1,025 7. Tax preparation online Each following required payment: If the payment on line 4 is due June 16, 2014, enter one-half of the amount on line 6 here and on the payment vouchers for your payments due September 15, 2014, and January 15, 2015. Tax preparation online If the amount on line 4 is due September 15, 2014, enter the amount from line 6 here and on the payment voucher for your payment due January 15, 2015 7. Tax preparation online $1,025 Worksheet 2-14. Tax preparation online Amended Estimated Tax Worksheet—Blank               1. Tax preparation online Amended total estimated tax due 1. Tax preparation online   2. Tax preparation online Multiply line 1 by:           50% (. Tax preparation online 50) if next payment is due June 16, 2014           75% (. Tax preparation online 75) if next payment is due September 15,  2014           100% (1. Tax preparation online 00) if next payment is due January 15,  2015 2. Tax preparation online       3. Tax preparation online Estimated tax payments for all previous periods 3. Tax preparation online       4. Tax preparation online Next required payment: Subtract line 3 from line 2 and enter the result (but not less than zero) here and on your payment voucher for your next required payment 4. Tax preparation online         Note. Tax preparation online If the payment on line 4 is due January 15, 2015, stop here. Tax preparation online Otherwise, go to line 5. Tax preparation online         5. Tax preparation online Add lines 3 and 4 5. Tax preparation online   6. Tax preparation online Subtract line 5 from line 1 and enter the result (but not less than zero) 6. Tax preparation online   7. Tax preparation online Each following required payment: If the payment on line 4 is due June 16, 2014, enter one-half of the amount on line 6 here and on the payment vouchers for your payments due September 15, 2014, and January 15, 2015. Tax preparation online If the amount on line 4 is due September 15, 2014, enter the amount from line 6 here and on the payment voucher for your payment due January 15, 2015 7. Tax preparation online   Underpayment penalty. Tax preparation online   The penalty is figured separately for each payment period. Tax preparation online If you figure your payments using the regular installment method and later refigure your payments because of an increase in income, you may be charged a penalty for underpayment of estimated tax for the period(s) before you changed your payments. Tax preparation online To see how you may be able to avoid or reduce this penalty, see Annualized Income Installment Method (Schedule AI) in chapter 4. Tax preparation online Annualized Income Installment Method If you do not receive your income evenly throughout the year (for example, your income from a repair shop you operate is much larger in the summer than it is during the rest of the year), your required estimated tax payment for one or more periods may be less than the amount figured using the regular installment method. Tax preparation online The annualized income installment method annualizes your tax at the end of each period based on a reasonable estimate of your income, deductions, and other items relating to events that occurred from the beginning of the tax year through the end of the period. Tax preparation online To see whether you can pay less for any period, complete the 2014 Annualized Estimated Tax Worksheet (Worksheet 2-9). Tax preparation online You first must complete the 2014 Estimated Tax Worksheet (Worksheet 2-1) through line 16b. Tax preparation online Use the result you figure on line 32 of Worksheet 2-9 to make your estimated tax payments and complete your payment vouchers. Tax preparation online Note. Tax preparation online If you use the annualized income installment method to figure your estimated tax payments, you must file Form 2210 with your 2014 tax return. Tax preparation online See Annualized Income Installment Method (Schedule AI) in chapter 4 for more information. Tax preparation online Instructions for the 2014 Annualized Estimated Tax Worksheet (Worksheet 2-9) Use Worksheet 2-9 to help you follow these instructions. Tax preparation online The purpose of this worksheet is to determine your estimated tax liability as your income accumulates throughout the year, rather than dividing your entire year's estimated tax liability by four as if your income was earned equally throughout the year. Tax preparation online The top of the worksheet shows the dates for each payment period. Tax preparation online The periods build; that is, each period includes all previous periods. Tax preparation online After the end of each payment period, complete the corresponding worksheet column to figure the payment due for that period. Tax preparation online Line 1. Tax preparation online   Enter your AGI for the period. Tax preparation online This is your gross income for the period, including your share of partnership or S corporation income or loss, minus your adjustments to income for that period. Tax preparation online See Expected AGI—Line 1 , earlier. Tax preparation online Self-employment income. Tax preparation online   If you had self-employment income, first complete Section B of this worksheet. Tax preparation online Use the amounts on line 43 when figuring your expected AGI to enter in each column of Section A, line 1. Tax preparation online Line 4. Tax preparation online   Be sure to consider all deduction limits figured on Schedule A (Form 1040), such as reducing your medical expenses by 10% (7. Tax preparation online 5% if either you or your spouse was born before January 2, 1950) or reducing certain miscellaneous deductions by 2% of your AGI. Tax preparation online Figure your deduction limits using your expected AGI in the corresponding column of line 1 (2014 Annualized Estimated Tax Worksheet (Worksheet 2-9)). Tax preparation online Line 6. Tax preparation online   Multiply line 4 by line 5 and enter the result on line 6 unless line 3 is more than $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately. Tax preparation online In that case, use Worksheet 2-10 to figure the amount to enter on line 6. Tax preparation online Complete Worksheet 2–10 for each period, as necessary. Tax preparation online Line 7. Tax preparation online   If you will not itemize your deductions, use Worksheet 2-4 to figure your standard deduction. Tax preparation online Line 10. Tax preparation online   Multiply $3,950 by your total expected exemptions and enter the result on line 10 unless line 3 is more than $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately. Tax preparation online   In that case, use Worksheet 2-11 to figure the amount to enter on line 10. Tax preparation online Line 12. Tax preparation online   Generally, you will use the Tax Rate Schedules to figure the tax on your annualized income. Tax preparation online However, see below for situations where you must use a different method to compute your estimated tax. Tax preparation online Tax on child's investment income. Tax preparation online   You must use a special method to figure tax on the income of the following children who have more than $2,000 of investment income. Tax preparation online Children under age 18 at the end of 2014. Tax preparation online The following children if their earned income is not more than half their support. Tax preparation online Children age 18 at the end of 2014. Tax preparation online Children who are full-time students over age 18 and under age 24 at the end of 2014. Tax preparation online See Publication 929. Tax preparation online Tax on net capital gain. Tax preparation online   The regular income tax rates for individuals do not apply to a net capital gain. Tax preparation online Instead, your net capital gain is taxed at a lower maximum rate. Tax preparation online   The term “net capital gain” means the amount by which your net long-term capital gain for the year is more than your net short-term capital loss. Tax preparation online Tax on qualified dividends and capital gains. Tax preparation online   For 2014, your capital gain and dividends rate will depend on your income. Tax preparation online Tax on capital gain or qualified dividends. Tax preparation online If the amount on line 1 includes a net capital gain or qualified dividends, use Worksheet 2-12 to figure the amount to enter on line 12. Tax preparation online Tax if excluding foreign earned income or excluding or deducting foreign housing. Tax preparation online If you expect to claim the foreign earned income exclusion or the housing exclusion or deduction on Form 2555 or Form 2555-EZ, use Worksheet 2-13 to figure the amount to enter on line 12. Tax preparation online Line 13. Tax preparation online   If you file Form 1040, add the tax from Forms 8814, 4972, and 6251 for the period. Tax preparation online If you file Form 1040A, add the amount from the Alternative Minimum Tax Worksheet found in the instructions. Tax preparation online Also include any recapture of an education credit for each period. Tax preparation online You may owe this tax if you claimed an education credit in an earlier year and you received either tax-free educational assistance or a refund of qualifying expenses for the same student after filing your 2013 return. Tax preparation online   Use the 2013 forms or worksheets to see if you will owe any of the taxes discussed above. Tax preparation online Figure the tax based on your income and deductions during the period shown in the column headings. Tax preparation online Multiply this amount by the annualization amounts shown for each column on line 2 of the 2014 Annualized Estimated Tax Worksheet (Worksheet 2-9). Tax preparation online Enter the result on line 13 of this worksheet. Tax preparation online Line 15. Tax preparation online   Include all the nonrefundable credits you expect to claim because of events that will occur during the period. Tax preparation online Note. Tax preparation online When figuring your credits for each period, annualize any item of income or deduction to figure each credit. Tax preparation online For example, if you need to use your AGI to figure a credit, use line 3 of Worksheet 2-9 to figure the credit for each column. Tax preparation online Line 18. Tax preparation online   Add your expected other taxes. Tax preparation online   Other taxes include the following. Tax preparation online Additional tax on early distributions from: An IRA or other qualified retirement plan, A tax-sheltered annuity, or A modified endowment contract entered into after June 20, 1988. Tax preparation online Household employment taxes if: You will have federal income tax withheld from wages, pensions, annuities, gambling winnings, or other income, or You would be required to make estimated tax payments even if you did not include household employment taxes when figuring your estimated tax. Tax preparation online Amounts on Form 1040 written on the line for “other taxes” (line 60 on the 2013 Form 1040). Tax preparation online But do not include recapture of a federal mortgage subsidy; tax on excess golden parachute payments; look-back interest due under section 167(g) or 460(b) of the Internal Revenue Code; excise tax on insider stock compensation from an expatriated corporation; uncollected social security, Medicare, or RRTA tax on tips or group-term life insurance; or additional tax on advance payments of health coverage tax credit when not eligible. Tax preparation online Repayment of the first-time homebuyer credit if the home will cease to be your main home in 2014. Tax preparation online See Form 5405 for exceptions. Tax preparation online Additional Medicare Tax. Tax preparation online A 0. Tax preparation online 9% Additional Medicare Tax applies to your combined Medicare wages and self-employment income and/or your RRTA compensation that exceeds the amount listed in the following chart, based on your filing status. Tax preparation online Filing Status Threshold Amount Married filing jointly $250,000 Married filing separately $125,000 Single $200,000 Head of household $200,000 Qualifying Widow(er) $200,000 Medicare wages and self-employment income are combined to determine if your income exceeds the threshold. Tax preparation online A self-employment loss should not be considered for purposes of this tax. Tax preparation online RRTA compensation should be separately compared to the threshold. Tax preparation online Your employer is responsible for withholding the 0. Tax preparation online 9% Additional Medicare Tax on Medicare wages or RRTA compensation it pays you in excess of $200,000 in 2014. Tax preparation online You should consider this withholding, if applicable, in determining whether you need to make an estimated payment. Tax preparation online For more information on Additional Medicare Tax, go to IRS. Tax preparation online gov and enter “Additional Medicare Tax” in the search box. Tax preparation online Net Investment Income Tax (NIIT). Tax preparation online The NIIT is 3. Tax preparation online 8% of the lesser of your net investment income or the excess of your modified adjusted gross income over a specified threshold amount. Tax preparation online Threshold amounts: Filing Status Threshold Amount Married filing jointly $250,000 Married filing separately $125,000 Single $200,000 Head of household $200,000 Qualifying Widow(er) $250,000 For more information on Net Investment Income Tax, go to IRS. Tax preparation online gov and enter “Net Investment Income Tax” in the search box. Tax preparation online Line 20. Tax preparation online   Include all the refundable credits (other than withholding credits) you can claim because of events that occurred during the period. Tax preparation online Note. Tax preparation online When figuring your refundable credits for each period, annualize any item of income or deduction used to figure each credit. Tax preparation online Line 29. Tax preparation online   If line 28 is smaller than line 25 and you are not certain of the estimate of your 2014 tax, you can avoid a penalty by entering the amount from line 25 on line 29. Tax preparation online Line 31. Tax preparation online   For each period, include estimated tax payments made and any excess social security and railroad retirement tax. Tax preparation online   Also include estimated federal income tax withholding. Tax preparation online One-fourth of your estimated withholding is considered withheld on the due date of each payment period. Tax preparation online To figure the amount to include on line 31 for each period, multiply your total expected withholding for 2014 by: 25% (. Tax preparation online 25) for the first period, 50% (. Tax preparation online 50) for the second period, 75% (. Tax preparation online 75) for the third period, and 100% (1. Tax preparation online 00) for the fourth period. Tax preparation online   However, you may choose to include your withholding according to the actual dates on which the amounts will be withheld. Tax preparation online For each period, include withholding made from the beginning of the period up to and including the payment due date. Tax preparation online You can make this choice separately for the taxes withheld from your wages and all other withholding. Tax preparation online For an explanation of what to include in withholding, see Total Estimated Tax Payments Needed—Line 16a , earlier. Tax preparation online Nonresident aliens. Tax preparation online   If you will file Form 1040NR and you do not receive wages as an employee subject to U. Tax preparation online S. Tax preparation online income tax withholding, the instructions for the worksheet are modified as follows. Tax preparation online Skip column (a). Tax preparation online On line 1, enter your income for the period that is effectively connected with a U. Tax preparation online S. Tax preparation online trade or business. Tax preparation online On line 21, increase your entry by the amount determined by multiplying your income for the period that is not effectively connected with a U. Tax preparation online S. Tax preparation online trade or business by the following. Tax preparation online 72% for column (b). Tax preparation online 45% for column (c). Tax preparation online 30% for column (d). Tax preparation online However, if you can use a treaty rate lower than 30%, use the percentages determined by multiplying your treaty rate by 2. Tax preparation online 4, 1. Tax preparation online 5, and 1, respectively. Tax preparation online On line 26, enter one-half of the amount from line 16c of the Form 1040-ES (NR) 2014 Estimated Tax Worksheet in column (b), and one-fourth in columns (c) and (d) of Worksheet 2-9. Tax preparation online On lines 24 and 27, skip column (b). Tax preparation online On line 31, if you do not use the actual withholding method, include one-half of your total expected withholding in column (b) and one-fourth in columns (c) and (d). Tax preparation online See Publication 519 for more information. Tax preparation online Estimated Tax Payments Not Required You do not have to pay estimated tax if your withholding in each payment period is at least as much as: One-fourth of your required annual payment, or Your required annualized income installment for that period. Tax preparation online You also do not have to pay estimated tax if you will pay enough through withholding to keep the amount you will owe with your return under $1,000. Tax preparation online How To Pay Estimated Tax There are several ways to pay estimated tax. Tax preparation online Credit an overpayment on your 2013 return to your 2014 estimated tax. Tax preparation online Pay by direct transfer from your bank account, or pay by credit or debit card using a pay-by-phone system or the Internet. Tax preparation online Send in your payment (check or money order) with a payment voucher from Form 1040-ES. Tax preparation online Credit an Overpayment If you show an overpayment of tax after completing your Form 1040 or Form 1040A for 2013, you can apply part or all of it to your estimated tax for 2014. Tax preparation online On Form 1040, or Form 1040A, enter the amount you want credited to your estimated tax rather than refunded. Tax preparation online Take the amount you have credited into account when figuring your estimated tax payments. Tax preparation online If you timely file your 2013 return, treat the credit as a payment made on April 15, 2014. Tax preparation online If you are a beneficiary of an estate or trust, and the trustee elects to credit 2014 trust payments of estimated tax to you, you can treat the amount credited as paid by you on January 15, 2015. Tax preparation online If you choose to have an overpayment of tax credited to your estimated tax, you cannot have any of that amount refunded to you until you file your tax return for the following year. Tax preparation online You also cannot use that overpayment in any other way. Tax preparation online Example. Tax preparation online When Kathleen finished filling out her 2013 tax return, she saw that she had overpaid her taxes by $750. Tax preparation online Kathleen knew she would owe additional tax in 2014. Tax preparation online She credited $600 of the overpayment to her 2014 estimated tax and had the remaining $150 refunded to her. Tax preparation online In September, she amended her 2013 return by filing Form 1040X, Amended U. Tax preparation online S. Tax preparation online Individual Income Tax Return. Tax preparation online It turned out that she owed $250 more in tax than she had thought. Tax preparation online This reduced her 2013 overpayment from $750 to $500. Tax preparation online Because the $750 had already been applied to her 2014 estimated tax or refunded to her, the IRS billed her for the additional $250 she owed, plus penalties and interest. Tax preparation online Kathleen could not use any of the $600 she had credited to her 2014 estimated tax to pay this bill. Tax preparation online Pay Online Paying online is convenient and secure and helps make sure we get your payments on time. Tax preparation online You can make your estimated tax payments online when you e-file or at any time during the year. Tax preparation online You can pay using either of the following electronic payment methods. Tax preparation online Direct transfer from your bank account. Tax preparation online Credit or debit card. Tax preparation online To pay your taxes online or for more information, go to www. Tax preparation online irs. Tax preparation online gov/e-pay. Tax preparation online Pay by Phone Paying by phone is another safe and secure method of paying electronically. Tax preparation online Use one of the following methods. Tax preparation online Direct transfer from your bank account. Tax preparation online Credit or debit card. Tax preparation online To pay by direct transfer from your bank account, call EFTPS Customer Service at 1-800-555-4477 (English), 1-800-244-4829 (Espanol), or TTY/TDD 1-800-733-4829. Tax preparation online To pay using a credit or debit card, you can call one of the following service providers. Tax preparation online There is a convenience fee charged by these providers that varies by provider, card type, and payment amount. Tax preparation online WorldPay 1-888-9-PAY-TAXTM (1-888-972-9829) www. Tax preparation online payUSAtax. Tax preparation online com Official Payments Corporation 1-888-UPAY-TAXTM (1-888-872-9829) www. Tax preparation online officialpayments. Tax preparation online com Link2GOV Corporation 1-888-PAY-1040TM (1-888-729-1040) www. Tax preparation online PAY1040. Tax preparation online com For the latest details on how to pay by phone, go to www. Tax preparation online irs. Tax preparation online gov/e-pay. Tax preparation online Pay by Check or Money Order Using the Estimated Tax Payment Voucher Each payment of estimated tax by check or money order must be accompanied by a payment voucher from Form 1040-ES. Tax preparation online If you use your own envelopes (and not the window envelope that comes with the 1040-ES package), make sure you mail your payment vouchers to the address shown in the Form 1040-ES instructions for the place where you live. Tax preparation online Do not use the address shown in the Form 1040 or Form 1040A instructions. Tax preparation online If you did not pay estimated tax last year, get a copy of Form 1040-ES from the IRS (see chapter 5). Tax preparation online Follow the instructions to make sure you use the vouchers correctly. Tax preparation online Joint estimated tax payments. Tax preparation online    If you file a joint return and are making joint estimated tax payments, enter the names and social security numbers on the payment voucher in the same order as they will appear on the joint return. Tax preparation online Change of address. Tax preparation online    You must notify the IRS if you are making estimated tax payments and you changed your address during the year. Tax preparation online Complete Form 8822, Change of Address, and mail it to the address shown in the instructions for that form. Tax preparation online Worksheets for Chapter 2 Use the following worksheets and tables to figure your correct estimated tax. Tax preparation online IF you need. Tax preparation online . Tax preparation online . Tax preparation online THEN use. Tax preparation online . Tax preparation online . Tax preparation online 2014 Tax Rate Schedules   the 2014 Estimated Tax Worksheet Worksheet 2-1 to estimate your taxable social security and railroad retirement benefits—line 1 of ES Worksheet (or Annualized ES Worksheet (Worksheet 2-9)) Worksheet 2-2 to estimate your self-employment (SE) tax and your deduction for SE tax—lines 1 and 11 of ES Worksheet (lines 1 and 17 of Annualized ES Worksheet (Worksheet 2-9)) Worksheet 2-3 to estimate your standard deduction—line 2 of ES Worksheet (line 7 of Annualized ES Worksheet (Worksheet 2-9)) Worksheet 2-4 to reduce your itemized deductions because your estimated AGI is more than $152,525—line 2 of ES Worksheet Worksheet 2-5 to reduce your exemption amount because your estimated AGI is more than $152,525—line 4 of ES Worksheet Worksheet 2-6 to estimate your income tax if line 1 of your ES Worksheet includes a net capital gain or qualified dividends—line 6 of ES Worksheet Worksheet 2-7 to estimate your income tax if you expect to claim a foreign earned income exclusion or foreign housing exclusion or deduction on Form 2555 or Form 2555-EZ—line 6 of ES Worksheet Worksheet 2-8 the 2014 Annualized Estimated Tax Worksheet (Annualized ES Worksheet) Worksheet 2-9 to reduce your itemized deductions because your estimated annualized AGI is more than $152,525—line 6 of Annualized ES Worksheet Worksheet 2-10 to reduce your exemption amount because your estimated annualized AGI is more than $152,525—line 10 of Annualized ES Worksheet Worksheet 2-11 to estimate your income tax if line 1 of your Annualized ES Worksheet includes a net capital gain or qualified dividends—line 12 of Annualized ES Worksheet Worksheet 2-12 to estimate your income tax if you expect to claim a foreign earned income exclusion or foreign housing exclusion or deduction on Form 2555 or Form 2555-EZ—line 12 of Annualized ES Worksheet Worksheet 2-13 to refigure (amend) your estimated tax during the year Worksheet 2-14 2014 Tax Rate Schedules Do not use these Tax Rate Schedules to figure your 2013 taxes. Tax preparation online Use them only to figure your 2014 estimated taxes. Tax preparation online Schedule X—Use if your 2014 filing status is  Single Schedule Z—Use if your 2014 filing status is Head of household If line 5 is: The tax is:     If line 5 is: The tax is:     Over— But not  over—         of the  amount  over— Over— But not  over—         of the  amount  over— $0 $9,075     10. Tax preparation online 0%   $0 $0 $12,950     10. Tax preparation online 0%   $0 9,075 36,900 $907. Tax preparation online 50 + 15. Tax preparation online 0%   9,075 12,950 49,400 $1,295. Tax preparation online 00 + 15. Tax preparation online 0%   12,950 36,900 89,350 5,081. Tax preparation online 25 + 25. Tax preparation online 0%   36,900 49,400 127,550 6,762. Tax preparation online 50 + 25. Tax preparation online 0%   49,400 89,350 186,350 18,193. Tax preparation online 75 + 28. Tax preparation online 0%   89,350 127,550 206,600 26,300. Tax preparation online 00 + 28. Tax preparation online 0%   127,550 186,350 405,100 45,353. Tax preparation online 75 + 33. Tax preparation online 0%   186,350 206,600 405,100 48,434. Tax preparation online 00 + 33. Tax preparation online 0%   206,600 405,100 406,750 117,541. Tax preparation online 25 + 35. Tax preparation online 0%   405,100 405,100 432,200 113,939. Tax preparation online 00 + 35. Tax preparation online 0%   405,100 406,750 - - - - - - 118,118. Tax preparation online 75 + 39. Tax preparation online 6%   406,750 432,200 - - - - - - 123,424. Tax preparation online 00 + 39. Tax preparation online 6%   432,200 Schedule Y-1—Use if your 2014 filing status is Married filing jointly or Qualifying widow(er) Schedule Y-2—Use if your 2014 filing status is  Married filing separately If line 5 is: The tax is:     If line 5 is: The tax is:     Over— But not  over—         of the  amount  over— Over— But not  over—         of the  amount  over— $0 $18,150     10. Tax preparation online 0%   $0 $0 $9,075     10. Tax preparation online 0%   $0 18,150 73,800 $1,815. Tax preparation online 00 + 15. Tax preparation online 0%   18,150 9,075 36,900 $907. Tax preparation online 50 + 15. Tax preparation online 0%   9,075 73,800 148,850 10,162. Tax preparation online 50 + 25. Tax preparation online 0%   73,800 36,900 74,425 5,081. Tax preparation online 25 + 25. Tax preparation online 0%   36,900 148,850 226,850 28,925. Tax preparation online 00 + 28. Tax preparation online 0%   148,850 74,425 113,425 14,462. Tax preparation online 50 + 28. Tax preparation online 0%   74,425 226,850 405,100 50,765. Tax preparation online 00 + 33. Tax preparation online 0%   226,850 113,425 202,550 25,382. Tax preparation online 50 + 33. Tax preparation online 0%   113,425 405,100 457,600 109,587. Tax preparation online 50 + 35. Tax preparation online 0%   405,100 202,550 228,800 54,793. Tax preparation online 75 + 35. Tax preparation online 0%   202,550 457,600 - - - - - - 127,962. Tax preparation online 50 + 39. Tax preparation online 6%   457,600 228,800 - - - - - - 63,981. Tax preparation online 25 + 39. Tax preparation online 6%   228,800                             Worksheet 2-1. Tax preparation online 2014 Estimated Tax Worksheet When this worksheet refers you to instructions, you can find those instructions in the Instructions for 2014 Form 1040-ES. Tax preparation online 1 Adjusted gross income you expect in 2014 (see instructions) 1     2 If you plan to itemize deductions, enter the estimated total of your itemized deductions. Tax preparation online  Caution: If line 1 is over $152,525, your deduction may be reduced. Tax preparation online See Worksheet 2-5. Tax preparation online If you do not plan to itemize deductions, enter your standard deduction. Tax preparation online 2     3 Subtract line 2 from line 1 3     4 Exemptions. Tax preparation online Multiply $3,950 by the number of personal exemptions. Tax preparation online  Caution: If line 1 is over $152,525, the amount of your personal exemptions may be limited. Tax preparation online See Worksheet 2-6. Tax preparation online 4     5 Subtract line 4 from line 3 5     6 Tax. Tax preparation online Figure your tax on the amount on line 5 by using the 2014 Tax Rate Schedules Caution: If you will have qualified dividends or a net capital gain, or expect to exclude or deduct foreign earned income or housing, see Worksheets 2-7 and 2-8 to figure the tax 6     7 Alternative minimum tax from Form 6251 or included on Form 1040A, line 28 7     8 Add lines 6 and 7. Tax preparation online Add to this amount any other taxes you expect to include in the total on Form 1040, line 44 8     9 Credits (see instructions). Tax preparation online Do not include any income tax withholding on this line 9     10 Subtract line 9 from line 8. Tax preparation online If zero or less, enter -0- 10     11 Self-employment tax (see instructions) 11     12 Other taxes including, if applicable, Additional Medicare Tax and/or NIIT (see instructions) 12     13a Add lines 10 through 12 13a     b Earned income credit, additional child tax credit, fuel tax credit, and refundable American opportunity credit 13b     c Total 2014 estimated tax. Tax preparation online Subtract line 13b from line 13a. Tax preparation online If zero or less, enter -0- ▶ 13c     14a Multiply line 13c by 90% (662/3% for farmers and fishermen) 14a           b Required annual payment based on prior year's tax (see instructions) 14b           c Required annual payment to avoid a penalty. Tax preparation online Enter the smaller of line 14a or 14b ▶ 14c        Caution: Generally, if you do not prepay (through income tax withholding and estimated tax payments) at least the amount on line 14c, you may owe a penalty for not paying enough estimated tax. Tax preparation online To avoid a penalty, make sure your estimate on line 13c is as accurate as possible. Tax preparation online Even if you pay the required annual payment, you may still owe tax when you file your return. Tax preparation online If you prefer, you can pay the amount shown on line 13c. Tax preparation online                         15 Income tax withheld and estimated to be withheld during 2014 (including income tax withholding on pensions, annuities, certain deferred income, etc. Tax preparation online ) 15     16a Subtract line 15 from line 14c 16a             Is the result zero or less? □ Yes. Tax preparation online Stop here. Tax preparation online You are not required to make estimated tax payments. Tax preparation online  □ No. Tax preparation online Go to line 16b. Tax preparation online             b Subtract line 15 from line 13c 16b             Is the result less than $1,000? □ Yes. Tax preparation online Stop here. Tax preparation online You are not required to make estimated tax payments. Tax preparation online  □ No. Tax preparation online Go to line 17 to figure your required payment. Tax preparation online                         17 If the first payment you are required to make is due April 15, 2014, enter ¼ of line 16a (minus any 2013 overpayment that you are applying to this installment) here, and on your estimated tax payment voucher(s) if you are paying by check or money order 17     Worksheet 2-2. Tax preparation online 2014 Estimated Tax Worksheet—Line 1 Estimated Taxable Social Security and Railroad Retirement Benefits Note. Tax preparation online If you are using this worksheet to estimate your taxable social security or railroad retirement benefits for Worksheet 2-9, 2014 Annualized Estimated Tax Worksheet, multiply the expected amount of benefits for each period by the annualization amount shown on Worksheet 2-9, line 2, for the same period before entering it on line 1 below. Tax preparation online     1. Tax preparation online Enter your expected social security and railroad retirement benefits 1. Tax preparation online   2. Tax preparation online Enter one-half of line 1 2. Tax preparation online   3. Tax preparation online Enter your expected total income. Tax preparation online Do not include any social security and railroad retirement benefits, nontaxable interest income, nontaxable IRA distributions, or nontaxable pension distributions 3. Tax preparation online   4. Tax preparation online Enter your expected nontaxable interest income 4. Tax preparation online   5. Tax preparation online Enter (as a positive amount) the total of any expected exclusions or deductions for: U. Tax preparation online S. Tax preparation online savings bond interest used for higher education expenses (Form 8815) Employer-provided adoption benefits (Form 8839) Foreign earned income or housing (Form 2555 or 2555-EZ) Income by bona fide residents of American Samoa (Form 4563) or Puerto Rico 5. Tax preparation online   6. Tax preparation online Add lines 2, 3, 4, and 5 6. Tax preparation online   7. Tax preparation online Enter your expected adjustments to income. Tax preparation online Do not include any student loan interest deduction 7. Tax preparation online   8. Tax preparation online Subtract line 7 from line 6. Tax preparation online If zero or less, stop here. Tax preparation online  Note. Tax preparation online Do not include any social security or railroad retirement benefits in the amount on line 1 of your 2014 Estimated Tax Worksheet (Worksheet 2-1) (or Annualized Estimated Tax Worksheet (Worksheet 2-9)) 8. Tax preparation online   9. Tax preparation online Enter $25,000 ($32,000 if you expect to file married filing jointly; $0 if you expect to file married filing separately and expect to live with your spouse at any time during the year) 9. Tax preparation online   10. Tax preparation online Subtract line 9 from line 8. Tax preparation online If zero or less, stop here. Tax preparation online  Note. Tax preparation online Do not include any social security or railroad retirement benefits in the amount on line 1 of your Worksheet 2-1 (or Annualized Estimated Tax Worksheet (Worksheet 2-9)) 10. Tax preparation online   11. Tax preparation online Enter $9,000 ($12,000 if you expect to file married filing jointly; $0 if you expect to file married filing separately and expect to live with your spouse at any time during the year) 11. Tax preparation online   12. Tax preparation online Subtract line 11 from line 10. Tax preparation online If zero or less, enter -0- 12. Tax preparation online   13. Tax preparation online Enter the smaller of line 10 or line 11 13. Tax preparation online   14. Tax preparation online Enter one-half of line 13 14. Tax preparation online   15