September 15 IRS Deadline: Your Comprehensive Guide to Necessary Payments
The clock is ticking louder and louder as the quarterly estimated tax payment deadline inches closer. It is indeed that time of the year when individuals who don’t have the benefit of automated tax withholdings from their earnings must gear up to settle their dues with the IRS. Time to take a deep breath, roll up those sleeves, and embark on the necessary task of dispatching the requisite payment to the IRS.
If you are steering your ship as a freelancer, managing your self-employment journey, overseeing a small-scale business, or delving into the world of investments, the obligation to meet this deadline falls unequivocally on your shoulders. As stipulated by the IRS, this regulatory requirement necessitates anyone expecting to owe $1,000 or more in annual taxes to adhere to the ritual of quarterly estimated payments. Embracing this practice not only aligns you with tax regulations but also assists in averting a potentially unpleasant shock when tax season eventually rolls around.
In emphasizing the urgency of this matter, Kathleen Kenealy, the insightful pioneer behind Katapult Financial Planning, highlights the intrinsic “pay-as-you-go” characteristic of the U.S. tax system. It’s a structure designed to be progressively balanced, thus minimizing the burden of a lump-sum payment at the year’s end. Kenealy urgently signals that lagging behind in meeting these payment milestones can inadvertently invite a swarm of irksome penalties that, honestly, no one wishes to entertain.
Should you find yourself straying from the established payment path and missing out on any of the four predetermined deadlines set for the 2023 fiscal year, brace yourself for the levy of a late penalty. A sizeable 0.5% of the outstanding balance will be appended to your dues monthly, reaching an upper limit of a substantial 25%, supplemented further with accruing interest.
In light of this, it becomes pivotal to maintain a meticulous schedule, aligned to the IRS’ calendar, to shield oneself from the ramifications of delayed payments, which are both financially and peace-of-mind taxing.
So, as we stand on the cusp of the next payment deadline, it’s prudent to initiate a thorough review of your financial statements, assess your taxable income with a discerning eye, and duly send off your payment to the IRS, ensuring a smoother sail into the upcoming tax season, devoid of unpleasant surprises.