If you don’t have taxes withheld on your income (you are self employed or you have a pension where it is hard to have withholding taken out, for instance) you may need to make estimated tax payments to the Federal and State tax agencies to avoid paying an underpayment penalty on late payments (you are required to pay in last year’s tax or 90% of your current years taxes in quarterly installments until January 15 of the following year.) See this IRS tip for more details:

http://content.govdelivery.com/accounts/USIRS/bulletins/af28cc?reqfrom=share

If you owe under $1000 to the IRS you don’t need to make estimates. It is a good idea to check it out so next year you will not get hit with this penalty.

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