Estimated Tax Payments for 2009
The Recovery Act reduces the 2009 required estimated tax payments for certain owners of small businesses.

An individual’s required estimated tax payments must generally equal the lesser of (1) 90% of the current year’s tax or (2) 100% of prior year’s tax (110% for individuals with adjusted gross income of $150,000 or more for the preceding year).

The new law reduces the required payments for qualifying individuals to the lesser of (1) 90% of current tax or (2) 90% of the prior year’s tax [IRC Sec. 6654(d)(1)].

To qualify an individual must (1) have adjusted gross income of less than $500,000 for the prior year, and (2) certify than more than 50% of his or her adjusted gross income comes from a small business. For this purpose, a small business is one that employs less than 500 employees.

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