Started self-employment late in year...estimated tax?

setting up any red flags with the IRS?

You could attempt to do this yourself, filing a belated 1040-ES and enclosing the 4th coupon only, but I woud like to seriously encourage you to seek professional assistance -- especially in this first year of your growing and apparently succssful business.

It's not only a matter of properly communicating with the IRS -- to avoid a minor penalty; it's really getting your business set up properly for the years ahead. An experienced small business accountant/tax preparer can be an invaluable asset for that purpose.

Please spend what it takes to get some good basic advice and assistance. At the very least, you'll have your books organized properly for the fist year, and avoid any serious IRS problems. If you determine that the format is basically manageable and decide to proceed on your own in the future, at least you'll have had the guidance to set it up correctly

-- and you can crib the proper procedures for your own benefit.

Please hie thee to an accountant, immediately.

Bill

Wait, "belated"? I thought you have until January 15 2008 to pay 4Q07 estimated taxes.

Actually, you don't FILE the 1040ES form with anybody. It is used by the taxpayer to determine whether or not you need to pay estimated tax, but retained in your files. Only the payment coupons, as appropriate, are sent to the IRS with your check.

text -

There may be easier ways to do it, but I believe you could file Form 2210 and possibly 2210AI, checking off box D and possibly box C on 2210 Part II. In plain English what that says is that you tell the IRS to treat the withholding taxes as paid when the money was actually withheld (and not evenly during the year) - that's box D. Box C says that your income during the year was uneven, so the amount you paid in during the year is allowed to be uneven as well. (This box triggers form 2210AI.)

The instructions for Form 2210 read: "For withheld federal income tax ... you are considered to have paid one-fourth of these amounts on each payment due date unless you can show otherwise. [If so] _you must check box D in Part II and complete ... Form 2210_" So you'll have to be able to substantiate the actual dates you had taxes withheld from your W2 employer.

The penalty for missing earlier quarters is prorated by the day. You can calculate all penalies yourself via the 2210 penalty form. That will tell you if you really to file by jan 15 and how much.