Input from IT consultant with their own LLC

[marcoi]

@T_Minus - Thanks for the great post. I wasn't sure about the taxes estimate schedule, all I knew about was there was a penalty if no taxes were sent in during the year. Not having to pay till Dec makes more sense and it's easier to deal with then quarterly for sure. I probably do like you said and keep 25% saved up for this year. Next year should be a lot easier to manage, since it will only be the one contract and not part year as employee/consultant.

As far as invoicing, I agreed to cover the ACH EFT fee for the company to pay my invoices electronically vs check. Its like 30 a month so not huge amount. I went this way so i dont have to be physically tied into a location to get a paper check each month.

 

[T_Minus]

Part year as employee = you already paid some taxes out of your paycheck so that's nice

I agree with the mail/paper check... I send it to an address near the bank where someone I know/trust deposits them for me so I can avoid dealing with them too LOL!! Now days online (free) deposit works as long as the checks are numbered how they should be, that's only issue I've ran into so far with phone mobile deposits.

 

[Marsh]

Not to disagree my buddy T_Minus about Estimate tax.

Estimated Tax Payments - What You Need To Know | Bankrate.com
The U.S. tax system works on a pay-taxes-as-you-earn basis, so the Treasury's goal is to get any estimated taxes regularly, too. The IRS has set up a timetable calling for estimated tax payments four times a year.

Freelancers, Make Sure to Pay Quarterly Estimated Taxes to Avoid an IRS Penalty
http://lifehacker.com/freelancers-make-sure-to-pay-quarterly-estimated-taxes-1792730577

In last 20years , my incomes consists Rents , Dividend , Interest , Capital Gain.
Sometimes , my income are lumpy , not even throughout the year.
You bet I pay my quarterly estimated tax on time.

 

[T_Minus]

Estimated Taxes

"Individuals, including sole proprietors, partners, and S corporation shareholders, generally have to make estimated tax payments if they expect to owe tax of $1,000 or more when their return is filed."

"If you owe more than $1,000, the IRS wants its owed taxes paid during the year. Any missed quarterly payment will result in penalties and interest."
Myths About Quarterly Taxes for the 1099 Tax Form - TurboTax Tax Tips & Videos

Well it also goes by previous year too @Marsh which is why your likely consistently paying I'd imagine if not my understanding is you could stop paying completely based on previous year of 0 income. Either way pay your tax based on your CPA / tax lawyer /etc and not us/some forum people We all interpret things differently and I don't think any of us do that for a living