Third quarter estimated tax payments are due to be mailed on or before September 15.  If you are self employed or have a change in your filing status or income for 2010 this is your chance to eliminate or reduce underpayment penalties.  You need to estimate your annual income (after deductions and expenses) and compute the amount you expect to owe.  Seventy-five percent of the total amount due should be paid in by September 15.   If you are unsure of how to make these calculations you will want to consult with your tax advisor.

IRS and state taxing agencies expect taxes to be paid on income as it is earned, hence the quarterly filing requirement.   Quarterly estimated payments are due on April 15, June 15, Septem,ber 15, and January 15 each year.  If you have income subject to a quarterly payment requirement and wait until April 15 to pay the tax, you will be subject to an underpayment penalty.

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