Jeff's Tax Liability for Last Year Was $30,000

question 96

Essay

Jeff's tax liability for last year was $30,000. Jeff projects that his tax for this year will be only $25,000. Jeff is self-employed and, thus, will have no withholding. His AGI for last year did not exceed $150,000. How much estimated tax, at a minimum, should Jeff pay for this year to avoid the penalty for underpayment of estimated taxes? How would your answer change if his income exceeded last year's due to a large capital gain at the end of the year?

---

Definitions:

Aggressive

Characterized by or exhibiting forceful actions or attitudes, often with the intention to dominate or assert oneself.

Firstborn Children

Children who are the first offspring born to a set of parents, often discussed in developmental psychology for their unique social and psychological traits.

Anxiety Levels

The intensity of feelings of worry, nervousness, or unease about something with an uncertain outcome.

Aggressively

In a manner showing readiness to attack or confront; characterized by or stemming from aggression.