For estimated tax purposes, the year is divided into four payment periods. Each period has a specific payment due date. 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. The following chart gives the payment periods and due dates for estimated tax payments.

Table 2.3

For the period:	Due date:
Jan. 1* through March 31	April 15
April 1 through May 31	June 15
June 1 through August 31	September 15
Sept. 1 through Dec. 31	Jan. 15 next
	year**
*If your tax year does not begin on January 1, see Fiscal year taxpayers, later.
**See January payment, later.

Saturday, Sunday, holiday rule. If the due date for making 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 legal holiday. For example, a payment due Sunday, April 15, 2001, will be on time if you make it by Monday, April 16, 2001.

January payment. If you file your 2001 Form 1040 or Form 1040A by January 31, 2002, and pay the rest of the tax you owe, you do not need to make your estimated tax payment that would be due on January 15, 2002.

Example 2.6. Janet Adams does not pay any estimated tax due for 2001. She files her 2001 income tax return and pays the balance due as shown on her return on January 24, 2002.

Janet's estimated tax for the fourth payment period is considered to have been paid on time. If she must pay a penalty for not making 2000 estimated tax payments, she will have no penalty for that period. Any penalty for the other payment periods will be figured up to January 24, 2002.

Fiscal year taxpayers. If your tax year does not start on January 1, your payment due dates are:

1. The 15th day of the 4th month of your fiscal year,
2. The 15th day of the 6th month of your fiscal year,
3. The 15th day of the 9th month of your fiscal year, and
4. The 15th day of the 1st month after the end of your fiscal year.

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.

When To Start

You do not have to make estimated tax payments until you have income on which you will owe the tax. 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. You can pay all your estimated tax at that time, or you can pay it in four installments. If you choose to pay in installments, make your first payment by the due date for the first payment period. Make your remaining installment payments by the due dates for the later periods.

No income subject to estimated tax during first period. If you first have income subject to estimated tax during a later payment period, you must make your first payment by the due date for that period. 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. The following chart shows the dates for making installment payments.

Table 2.4

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 15
		September 15
		January 15
		next year*
After March 31 and before
June 1	June 15	September 15
		January 15
		next year*
After May 31 and before
Sept. 1	September 15	January 15
		next year*
After August 31	January 15
	next year*	(None)
*See January payment and Saturday, Sunday, holiday rule under When To Pay Estimated Tax, earlier.

Change in estimated tax. After making your first estimated tax payment, changes in your income, adjustments, deductions, credits, or exemptions may make it necessary for you to refigure your estimated tax. 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.

How much to pay to avoid penalty. To determine how much you should pay by each payment due date, see How To Figure Each Payment, later. If the earlier discussions of No income subject to estimated tax during first period or Change in estimated tax apply to you, you may need to read the explanation of the Annualized Income Installment Method, later, to avoid a penalty.

Farmers and Fishermen

If at least two-thirds of your gross income for 2000 or 2001 is from farming or fishing, you have only one payment due date for your 2001 estimated tax -- January 16, 2002. The due dates for the first three payment periods, discussed earlier under When To Pay Estimated Tax, do not apply to you.

If you file your 2001 Form 1040 by March 1, 2002, and pay all the tax you owe, you do not need to pay estimated tax.

Joint returns. 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.

Gross income. Your gross income is all income you receive in the form of money, goods, property, and services that is not exempt from tax. To determine whether two-thirds of your gross income for 2000 was from farming or fishing, use as your gross income the total of the income (not loss) amounts shown in the following locations.

1. Form 1040, lines 7, 8a, 9, 10, 11, 15b, 16b, 19, 20b, and 21.
2. Schedule C (Form 1040), line 7.
3. Schedule C-EZ (Form 1040), line 1.
4. Schedule D (Form 1040), line 1, column f (gains only), and lines 8 and 13, column f (gains only).
5. Schedule D-1 (Form 1040), line 1, column f (gains only), and line 8, column f (gains only).
6. Schedule E (Form 1040), lines 3, 4, 36, and 38.
7. Schedule F (Form 1040), line 11.
8. Form 2439, Box 1a.
9. Form 4684, lines 15 and 36.
10. Form 4797, line 2, column g (gains only), and line 6 (gains only).
11. Form 6252, line 26 or line 37 (gains only).
12. Form 6781, line 8, column c (gain only), and line 9, column c (gain only).
13. Form 8824, line 22 (unless the installment method applies).
14. Form 4835, line 7.
15. Schedule K-1 (Form 1065), lines 15b and 15c (less any partnership amounts included in (1) through (14)).

Also add your pro rata share of S corporation gross income (less any S corporation amounts included in (1) through (14)).

Gross income from farming. This is income from cultivating the soil or raising agricultural commodities. It includes the following amounts.

1. Income from operating a stock, dairy, poultry, bee, fruit, or truck farm.
2. Income from a plantation, ranch, nursery, range, orchard, or oyster bed.
3. Crop shares for the use of your land.
4. Gains from sales of draft, breeding, dairy, or sporting livestock.

For 2000, gross income from farming is the total of the amounts from line 11 of Schedule F (Form 1040), Profit or Loss From Farming, and line 7 of Form 4835, Farm Rental Income and Expenses, plus your share of a partnership's or S corporation's gross income from farming, your share of distributable net income from farming of an estate or trust, and your gains from sales of draft, breeding, dairy, or sporting livestock shown on Form 4797, Sales of Business Property.

Wages you receive as a farm employee and wages you receive from a farm corporation are not gross income from farming.

Gross income from fishing. 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.

Gross income from fishing includes the following amounts.

1. Income for services as an officer or crew member of a vessel while the vessel is engaged in fishing.
2. Your share of a partnership's or S corporation's gross income from fishing.
3. Income for services normally performed in connection with fishing.

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.

Fiscal year farmers and fishermen. If you are a farmer or fisherman, but your tax year does not start on January 1, you can either:

1. Pay all your estimated tax by the 15th day after the end of your tax year, or
2. 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.

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