Once you’ve installed Tiller’s Estimated Quarterly Tax sheet you can configure it for your tax situation to calculate estimated small business quarterly tax payments.
Set the year.
Choose the new year if you’re hoping to estimate your quarterly taxes going forward into the new year. You can also choose the previous year if you want help estimating what you might owe for the last quarter of the year or whether you’ve paid enough already for the previous year and might have a tax bill for the April 15th tax deadline. The dashboard includes IRS data for tax years 2018 and 2019.
Set your filing status.
You can choose any of the four filing statuses available from the IRS.
Be aware that if you choose Married - Filing Jointly, the tool works best if your spouse is not employed.
Keep in mind that if you file as Head of Household, you must claim a dependent, and the tool does not account for child tax credits for which you may be eligible.
Set your taxes paid category.
The dashboard can automatically show how much you paid in taxes by quarter. To do this, the sheet asks that you choose a category that you use for the tax payments you’ve made throughout the year. For best results use the same category for federal and state estimated payments you make throughout the year. Payments appear in the row called “Tax Payments” lower in the dashboard.
Note: do not tag the category you use for quarterly tax payments as "business" on the Categories sheet.
Set your state tax rate.
Set your flat state tax rate or calculate and manually enter your effective tax rate if your state uses a bracket system. If you need to pay estimated taxes in more than one state, consult with a tax advisor on estimated state tax payments and which one to use for your primary state. Consult with a tax advisor on how to calculate your effective state tax rate if your state uses a bracket system.
Reviewing your estimated payments
At this point the Estimated Quarterly Tax sheet should begin calculating estimated taxes based on your categorized business income and expenses. It calculates the estimates based on categorized transaction data from your Transactions sheet. It only pulls in data for transactions categorized with categories tagged as “Business” on the Categories sheet for IRS tax quarters that correspond to the selected year.
Heads up, if you’re starting out with this tool at the beginning of a new year, and don’t have any business earnings or expenses just yet, you won’t see much in the Estimated Tax Due section. These estimated taxes are calculated in near real time as your transaction data flows in via Tiller’s automated bank feeds and you categorize on your Transactions sheet.