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Each partner must complete this form to pay quarterly income tax on their portion of
the partner's net income.
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| Forms to use | |
1040-ES Worksheet
1040-ES Coupon |
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| Amount due | |
15% to 35% on your share of the business' net income (plus your other personal income).
| | | Single | | Married | | Hd Household | Mar/Fil Sep |
| 10% on first $ net income | |
| 10% on first $ net income | |
8,500 |
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17,000 |
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12,150 |
8,500 |
| 15% on next income up to: |
| 34,500 |
| 69,000 |
| 46,250 |
34,500 |
| 25% on next income up to: |
| 83,600 |
| 139,350 |
| 119,400 |
69,675 |
| 28% on next income up to: |
| 174,400 |
| 212,300 |
| 193,350 |
106,150 |
| 33% on next income up to: |
| 379,150 |
| 379,150 |
| 379,150 |
189,575 |
| then 35% | | | | | |
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| Can you deduct your draws or "salary"? | |
For accounting and tax purposes, partners cannot
consider any draws or partner "salaries" as expenses. |
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| To avoid penalties | |
To avoid penalties, you must pay 90% of this year's tax or 100% of last year's tax in normal employment
withholding or estimated tax (this form). There are special requirements if your household income
was over $156,400 or you are a fisherman. Please see 1040ES instructions.
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How partners should complete the form
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| Line | What to enter |
| 1 | Take your share of the the annualized net income that you calculated with
IRS 1040 Schedule SE.
and add any other income you (or your spouse if you file jointly) expect to earn this year. |
| 2 | To avoid IRS fines for incorrect estimates, just use the standard deduction.
For 2008, this is $10,900 for married filing jointly; $8,000 for head of household and $5,450 for single. |
| 3 | Line 1 minus line 2 |
| 4 | Multiply the number of personal exemptions by $3,500 |
| 5 | Line 3 minus line 4 |
| 6 | Tax. See tax rate schedules on page 2 of the instructions or the information
shown above. |
| 7-8 | Adjustments for alternative minimum tax, which is usually 0, unless you
had large write-offs. |
| 9-10 | Adjustments for credits, which are usually 0, unless last year
you had tax credits and they still apply. |
| 11 | Self-employment tax. See Schedule SE to calculate. |
| 12 | Other taxes, which include employment taxes for household employees plus annuity,
endowment or IRA taxes. |
| 13 | Add lines 10, 11 and 12 and subtract any earned income credit.
Earned income credit is not available to partner/owners of businesses. |
| 13c | Tax due this year. |
| 14 | Enter the smaller of 90% of line 13c or last year's tax on your
1040 return. Note. If you earned more than $156,400 last year, you should enter 90% of line 13c
or 110% of last year's tax. |
| 15 | Income tax that will be withheld during the year
through payroll deductions (from other jobs). |
| 16 | Tax that must be paid quarterly this year: Line 14c minus line 15. |
| 17 | Deposit now: Divide line 16 by the number of quarterly due dates
remaining before next April 15th, i.e. if you begin business on June 30, you will have two due dates: September 15th and January 15th. |
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| Due date | |
April 15, June 15, September 15, January 15. |
| To pay
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- Pay electronically
- Pay via credit card (with a 2-3% service fee). There are two approved providers:
- Link2Gov Corporation at (888) 729-1040. For questions call (888) 658-5465 or visit
www.pay1040.com
- Official Payments Corporation at (800) 272-9829. For questions call (877) 754-4413 or visit
www.officialpayments.com.
In addition, you can use your Discover card for no service fee if you file through TurboTax or Quicken Products.
- Mail your check with Form 1040ES to the IRS.
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| Questions? | |
Call the IRS information hotline 800 829-1040. For forms, call
(800) 829-3676 or obtain them online at http://www.irs.gov/formspubs/index.html.
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