Reminder: Second Estimated Tax Payment Due June 15

For those making quarterly personal federal estimated income tax payments, the second quarterly payment is due on June 15, 2018.

Since the U.S. tax system operates on a pay-as-you-go basis, taxpayers are required by law to pay their tax liability during the year. Most often, self-employed people need to pay quarterly installments of estimated tax. Similarly, investors, retirees and others whose income is not subject to withholding often need to make these payments as well. Employees generally do not need to make estimated tax payments because employers withhold income taxes from the employees' paychecks.

Taxpayers can pay their estimated tax payments online (through EFTPS or IRS Direct Pay), by phone, or by mail. If you mail your estimated tax payment and the date of the U.S. postmark is on or before the due date, the IRS will consider the payment to be on time, even if the IRS receives it after the due date.

IRS Reminds People to Remain Alert to Scams

Scammers don’t take a summer vacation. With tax season completed, summertime tends to be a favorite period for scammers because many taxpayers have recently filed a return and may be waiting for a response from the IRS. Here are some things for taxpayers to remember so they can keep their personal data safe:

The IRS does not leave pre-recorded, urgent messages asking for a call back. In one scam, the victim is told if they do not call back, a warrant will be issued for their arrest. Other variations may include the threat of deportation or revocation of licenses. The IRS will never threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying.

If a taxpayer receives an unsolicited email that appears to be from the IRS, they should report it by sending it to phishing@irs.gov. The IRS does not initiate contact with taxpayers by email to request personal or financial information. The IRS initiates most contacts through regular mail delivered by the United States Postal Service.

Taxpayers should be on the lookout for any attempt to get them to disclose personal information like Social Security numbers, bank account information, or passwords. If in doubt, don’t give it out.

Tax Tips For Summer Job

Now that school is out, many students will be starting summer jobs. Here are some things students should keep in mind about taxes.

Not all the money you earn will make it to your pocket. Your employer is required to withhold various taxes from your paycheck. Employers must withhold Social Security and Medicare taxes (also known as FICA taxes), and this will amount to 7.65% of your gross income. Employers also withhold federal income taxes (as well as state income taxes if you are in a state that has a state income tax), but you may not earn enough from your summer job to owe income tax. As a new employee, your employer will have you fill out a Form W-4. Employers use this form to calculate how much income tax to withhold from your pay.

If you receive tips as part of you summer income, keep in mind that tip income is taxable income. The IRS requires tipped employees to report tips of $20 or more received in cash in any single month.

Students who do odd jobs over the summer to make extra cash, such as baby-sitting or lawn mowing, are considered self-employed. (Always remember that money you earn doing work for others is taxable.) The IRS requires you to file a tax return if your net earnings from self-employment are $400 or more for the year. Keep good records of expenses related to your self-employment work, because you may be able to deduct (subtract) those costs from your income on your tax return.

If you are in an ROTC program, active duty pay, such as pay for summer advanced camp, is taxable. Other allowances the taxpayer may receive – such as food and lodging allowances paid to ROTC students participating in advanced training – is not taxable.

You may not earn enough money from your summer job to be required to file a tax return. Even so, you may still want to file a 2018 tax return. For example, if your employer withheld income tax from your pay, you will have to file a return to get your taxes refunded.