Question
I need to estimate tax liability because I know I have a balance due and owe taxes. How do I estimate extension tax liability?
Answer
To estimate your taxes due/balance owed, you can do either of these:
- Use the estimated tax worksheet in the instructions for Form 1040-ES. Use Line 13c as your estimated taxes due/balance owed on your extension as filed on Form 4868.
- Complete your return with the actual figures you have and estimate figures for those that you don’t. Use the amount of tax due on the return as your estimated taxes due/balance owed. Make sure you replace all of your estimates with actual figures before filing your return.
When you eventually file your return:
- You’ll receive a refund for any tax you overpaid.
- If you underpaid and owe tax, the remaining balance owed amount will be subject to interest and penalties.
Related Resources
Amend Tax Return For Multiple W-2's
Filing another W-2 with form 1040x after you have already filed your tax return. Learn more from the tax experts at H&R Block.
Why Did I Receive a Form 1098-T from My School?
If you’re a college student, you’ll probably receive a Form 1098-T. Learn more about the importance of this college tax form with the experts at H&R Block.
IRS Letter 3338C – Audit Reconsideration Acknowledgment
Did you receive IRS Letter 3338C? Learn more about letter 3338C and how to handle it with help from the tax experts at H&R Block.
IRS Letter 6001 – Advanced Premium Tax Credit Recipients Non-Filer Letter
The IRS is requesting your return. Learn more about IRS Letter 6001 and how to address it with help from the tax experts at H&R Block.