Derek Davis
CPA and Founder of Shared Economy CPA
What is Quarterly Taxes?
As a Homesharing/Airbnb host, the money you earned from renting out a room in your apartment or house is considered income and you must pay taxes on those earnings. Because there is no withholding from this income (e.g. taxes taken out), the government may require that you pay taxes on this amount four times a year. Estimated tax payments are due April 15th, June 15th, September 15th and January 15th.
Who owes Quarterly Taxes?
If you have more than $1,000 in 1099 taxes, you are potentially responsible to pay quarterly taxes. This amount is computed as the following:
Income – Expenses = Net Income * Self-Employed Tax Rate
In the calculation above, if the amount is more than $1,000, you may be required to pay quarterly tax.
What if I don’t pay Quarterly Taxes?
Unfortunately, if you are required to pay quarterly taxes and do not pay, penalties may be applied to you when you file your income tax return. In 2015 alone, the IRS assessed over $1 billion dollars in estimated tax penalties.
Who are we and what do we do?
Shared Economy CPA is the premiere CPA firm that helps individuals working in the Sharing Economy and 1099 Independent Contractors with all tax planning, compliance, preparation, savings, and peace of mind. Specifically, we provide the following services:
- Individual and Business Income Tax Return Preparation
- Entity Selection: Set-up Corporate and LLC Tax Reporting Structures and associated tax requirements
- Compliance with local, state, and federal regulatory requirements
- Tax and Estate Planning
- Quarterly tax payment planning and preparation
- IRS Audit and Defense
- Airbnb Hotel Tax