Publication 519 |
2000 Tax Year |
Introduction
This chapter discusses how to pay your U.S. income tax as you earn
or receive income during the year. In general, the federal income tax
is a pay as you go tax. There are two ways to pay as you go.
- Withholding. If you are an employee, your
employer probably withholds income tax from your pay. Tax may also be
withheld from certain other income--including pensions, bonuses,
commissions, and gambling winnings. In each case, the amount withheld
is paid to the U.S. Treasury in your name.
- Estimated tax. If you do not pay your tax through
withholding, or do not pay enough tax that way, you might have to pay
estimated tax. People who are in business for themselves generally
will have to pay their tax this way. You may have to pay estimated tax
if you receive income such as dividends, interest, rent, and
royalties. Estimated tax is used to pay not only income tax, but
self-employment tax and alternative minimum tax as well.
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