Question on prepaying taxes

[paulney]

Title pretty much says it all: if I supply a check for a greater amount that the payment stub says, will the IRS record it properly or will I have a hard time proving I prepaid my taxes for a bigger amount later?

Thanks.

 

[Saga]

Why would you willingly give the government a free loan? Stick it in a account that gains interest and next year when you pay at least you made money off it instead of throwing it away.

 

[amdskip]

Why don't you contact them and ask them? Personally I'd just set the money aside and pay the requested amount.

 

[paulney]

Originally posted by: Izusaga
Why would you willingly give the government a free loan? Stick it in a account that gains interest and next year when you pay at least you made money off it instead of throwing it away.

Well, business is doing a little better than I expected, and I don't want to get hit with a penalty when my unpaid taxes will exceed 5% of the revenue. I didn't prepay last year, so this year I pretty much have to.

 

[JS80]

As long as you have a copy of the check you are good. Make sure to put the Tax ID on the check though and specify it's for INCOME TAX for year XXXX.

 

[Saga]

Originally posted by: paulney

Originally posted by: Izusaga
Why would you willingly give the government a free loan? Stick it in a account that gains interest and next year when you pay at least you made money off it instead of throwing it away.

Well, business is doing a little better than I expected, and I don't want to get hit with a penalty when my unpaid taxes will exceed 5% of the revenue. I didn't prepay last year, so this year I pretty much have to.

The way you phrased the original post it appeared to be in refernece to your personal taxes.

What you are referring to is known as Estimated Taxes. I would suggest researching that term on the IRS.gov website or your local state information site for further information on how to remain in compliance with your estimated taxes.