What is the best way to pay large tax amount owed to IRS?
.everyoneloves__top-leaderboard:empty,.everyoneloves__mid-leaderboard:empty,.everyoneloves__bot-mid-leaderboard:empty{ margin-bottom:0;
}
I recently did a preliminary calculation of my taxes for 2018 and discovered that I am going to owe the IRS about $16,000. I do not have this amount of money in reserve.
My question pertains to the best way to pay this amount. Options as I see them:
- Sell an asset to raise the money (such as a car)
- Put it on the credit card
- Withdraw from 401k to raise funds
- Use an IRS payment plan
Unfortunately, #1 isn't a great option (I need my car). So it's going to be something from 2-4:
- Credit card. My interest rate on purchases is 18.24% annually. Could work.
- Withdraw from 401k. Doing this would put me in the 24% income tax bracket, plus the 10% penalty on the total amount withdrawn, plus the state wants a piece. This amounts to about a 39% hit. This is a terrible idea.
- IRS payment plan - I read up a bit on this and couldn't get a good understanding of what the actual costs are. The annual interest rate is 3%, but there are fees and also a late payment penalty of 0.25% per month.
united-states income-tax irs
edited Feb 11 at 4:50
Kat
930411
asked Feb 10 at 1:09
MarkMark
22316
|
show 11 more comments
I recently did a preliminary calculation of my taxes for 2018 and discovered that I am going to owe the IRS about $16,000. I do not have this amount of money in reserve.
My question pertains to the best way to pay this amount. Options as I see them:
- Sell an asset to raise the money (such as a car)
- Put it on the credit card
- Withdraw from 401k to raise funds
- Use an IRS payment plan
Unfortunately, #1 isn't a great option (I need my car). So it's going to be something from 2-4:
- Credit card. My interest rate on purchases is 18.24% annually. Could work.
- Withdraw from 401k. Doing this would put me in the 24% income tax bracket, plus the 10% penalty on the total amount withdrawn, plus the state wants a piece. This amounts to about a 39% hit. This is a terrible idea.
- IRS payment plan - I read up a bit on this and couldn't get a good understanding of what the actual costs are. The annual interest rate is 3%, but there are fees and also a late payment penalty of 0.25% per month.
united-states income-tax irs
edited Feb 11 at 4:50
Kat
930411
asked Feb 10 at 1:09
MarkMark
22316
5
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
30
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
10
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
2
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
3
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38
|
show 11 more comments
I recently did a preliminary calculation of my taxes for 2018 and discovered that I am going to owe the IRS about $16,000. I do not have this amount of money in reserve.
My question pertains to the best way to pay this amount. Options as I see them:
- Sell an asset to raise the money (such as a car)
- Put it on the credit card
- Withdraw from 401k to raise funds
- Use an IRS payment plan
Unfortunately, #1 isn't a great option (I need my car). So it's going to be something from 2-4:
- Credit card. My interest rate on purchases is 18.24% annually. Could work.
- Withdraw from 401k. Doing this would put me in the 24% income tax bracket, plus the 10% penalty on the total amount withdrawn, plus the state wants a piece. This amounts to about a 39% hit. This is a terrible idea.
- IRS payment plan - I read up a bit on this and couldn't get a good understanding of what the actual costs are. The annual interest rate is 3%, but there are fees and also a late payment penalty of 0.25% per month.
united-states income-tax irs
edited Feb 11 at 4:50
Kat
930411
asked Feb 10 at 1:09
MarkMark
22316
I recently did a preliminary calculation of my taxes for 2018 and discovered that I am going to owe the IRS about $16,000. I do not have this amount of money in reserve.
My question pertains to the best way to pay this amount. Options as I see them:
- Sell an asset to raise the money (such as a car)
- Put it on the credit card
- Withdraw from 401k to raise funds
- Use an IRS payment plan
Unfortunately, #1 isn't a great option (I need my car). So it's going to be something from 2-4:
- Credit card. My interest rate on purchases is 18.24% annually. Could work.
- Withdraw from 401k. Doing this would put me in the 24% income tax bracket, plus the 10% penalty on the total amount withdrawn, plus the state wants a piece. This amounts to about a 39% hit. This is a terrible idea.
- IRS payment plan - I read up a bit on this and couldn't get a good understanding of what the actual costs are. The annual interest rate is 3%, but there are fees and also a late payment penalty of 0.25% per month.
united-states income-tax irs
united-states income-tax irs
edited Feb 11 at 4:50
Kat
930411
asked Feb 10 at 1:09
MarkMark
22316
edited Feb 11 at 4:50
Kat
930411
asked Feb 10 at 1:09
MarkMark
22316
edited Feb 11 at 4:50
Kat
930411
edited Feb 11 at 4:50
Kat
930411
edited Feb 11 at 4:50
Kat
930411
930411
asked Feb 10 at 1:09
MarkMark
22316
asked Feb 10 at 1:09
MarkMark
22316
asked Feb 10 at 1:09
MarkMark
22316
22316
5
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
30
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
10
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
2
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
3
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38
|
show 11 more comments
5
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
30
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
10
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
2
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
3
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38
5
5
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
30
30
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
10
10
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
2
2
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
3
3
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38
|
show 11 more comments
2 Answers
2
active
oldest
votes
Of the options you've listed, setting up a payment plan with the IRS is the best, cheapest option. The current interest rate from the IRS is 6%. This interest rate is updated once every three months based on the federal short term rate. The penalty charged is an additional 0.25% per month (roughly another additional 3% per year). This works out to a rate of around 9%, which is much better than your credit card or your 401(k).
You may be able to get a better loan rate by talking to a local bank or credit union. If you can beat 9%, then that would probably be a better option than IRS installments.
However, more important than the interest rate you can get is how quickly you pay it off. Dedicate yourself to eliminating this debt as fast as possible. Work as hard as you can to save up as much as possible between now and April 15 to minimize the amount you have to borrow, and keep working at it afterwards until this debt is paid off.
Finally, there must be a reason that you have found yourself with a large tax bill and no money. Hopefully, you know what went wrong so you don't make that mistake again. If not, be sure to figure it out.
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
add a comment |
Ben is right as far as your options. I'd use the IRS payment plan. You're allowed to use a payment plan every few years I believe. I owed around that amount ($18K) and was able to make $2K a month payments. I don't remember exactly what the fees were, but it wasn't much. That allowed me time to make additional income as I'm always paying $20K a year in taxes.
Pay what you can in the next 2 months and get a payment plan. If you're going to be in the same scenario again, start putting back money as you can.
Best of luck.
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
add a comment |
Your Answer
StackExchange.ready(function() {
var channelOptions = {
tags: "".split(" "),
id: "93"
};
initTagRenderer("".split(" "), "".split(" "), channelOptions);
StackExchange.using("externalEditor", function() {
// Have to fire editor after snippets, if snippets enabled
if (StackExchange.settings.snippets.snippetsEnabled) {
StackExchange.using("snippets", function() {
createEditor();
});
}
else {
createEditor();
}
});
function createEditor() {
StackExchange.prepareEditor({
heartbeatType: 'answer',
autoActivateHeartbeat: false,
convertImagesToLinks: true,
noModals: true,
showLowRepImageUploadWarning: true,
reputationToPostImages: 10,
bindNavPrevention: true,
postfix: "",
imageUploader: {
brandingHtml: "Powered by u003ca class="icon-imgur-white" href="https://imgur.com/"u003eu003c/au003e",
contentPolicyHtml: "User contributions licensed under u003ca href="https://creativecommons.org/licenses/by-sa/3.0/"u003ecc by-sa 3.0 with attribution requiredu003c/au003e u003ca href="https://stackoverflow.com/legal/content-policy"u003e(content policy)u003c/au003e",
allowUrls: true
},
noCode: true, onDemand: true,
discardSelector: ".discard-answer"
,immediatelyShowMarkdownHelp:true
});
}
});
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function () {
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmoney.stackexchange.com%2fquestions%2f105138%2fwhat-is-the-best-way-to-pay-large-tax-amount-owed-to-irs%23new-answer', 'question_page');
}
);
Post as a guest
Required, but never shown
2 Answers
2
active
oldest
votes
2 Answers
2
active
oldest
votes
active
oldest
votes
active
oldest
votes
Of the options you've listed, setting up a payment plan with the IRS is the best, cheapest option. The current interest rate from the IRS is 6%. This interest rate is updated once every three months based on the federal short term rate. The penalty charged is an additional 0.25% per month (roughly another additional 3% per year). This works out to a rate of around 9%, which is much better than your credit card or your 401(k).
You may be able to get a better loan rate by talking to a local bank or credit union. If you can beat 9%, then that would probably be a better option than IRS installments.
However, more important than the interest rate you can get is how quickly you pay it off. Dedicate yourself to eliminating this debt as fast as possible. Work as hard as you can to save up as much as possible between now and April 15 to minimize the amount you have to borrow, and keep working at it afterwards until this debt is paid off.
Finally, there must be a reason that you have found yourself with a large tax bill and no money. Hopefully, you know what went wrong so you don't make that mistake again. If not, be sure to figure it out.
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
add a comment |
Of the options you've listed, setting up a payment plan with the IRS is the best, cheapest option. The current interest rate from the IRS is 6%. This interest rate is updated once every three months based on the federal short term rate. The penalty charged is an additional 0.25% per month (roughly another additional 3% per year). This works out to a rate of around 9%, which is much better than your credit card or your 401(k).
You may be able to get a better loan rate by talking to a local bank or credit union. If you can beat 9%, then that would probably be a better option than IRS installments.
However, more important than the interest rate you can get is how quickly you pay it off. Dedicate yourself to eliminating this debt as fast as possible. Work as hard as you can to save up as much as possible between now and April 15 to minimize the amount you have to borrow, and keep working at it afterwards until this debt is paid off.
Finally, there must be a reason that you have found yourself with a large tax bill and no money. Hopefully, you know what went wrong so you don't make that mistake again. If not, be sure to figure it out.
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
add a comment |
Of the options you've listed, setting up a payment plan with the IRS is the best, cheapest option. The current interest rate from the IRS is 6%. This interest rate is updated once every three months based on the federal short term rate. The penalty charged is an additional 0.25% per month (roughly another additional 3% per year). This works out to a rate of around 9%, which is much better than your credit card or your 401(k).
You may be able to get a better loan rate by talking to a local bank or credit union. If you can beat 9%, then that would probably be a better option than IRS installments.
However, more important than the interest rate you can get is how quickly you pay it off. Dedicate yourself to eliminating this debt as fast as possible. Work as hard as you can to save up as much as possible between now and April 15 to minimize the amount you have to borrow, and keep working at it afterwards until this debt is paid off.
Finally, there must be a reason that you have found yourself with a large tax bill and no money. Hopefully, you know what went wrong so you don't make that mistake again. If not, be sure to figure it out.
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
Of the options you've listed, setting up a payment plan with the IRS is the best, cheapest option. The current interest rate from the IRS is 6%. This interest rate is updated once every three months based on the federal short term rate. The penalty charged is an additional 0.25% per month (roughly another additional 3% per year). This works out to a rate of around 9%, which is much better than your credit card or your 401(k).
You may be able to get a better loan rate by talking to a local bank or credit union. If you can beat 9%, then that would probably be a better option than IRS installments.
However, more important than the interest rate you can get is how quickly you pay it off. Dedicate yourself to eliminating this debt as fast as possible. Work as hard as you can to save up as much as possible between now and April 15 to minimize the amount you have to borrow, and keep working at it afterwards until this debt is paid off.
Finally, there must be a reason that you have found yourself with a large tax bill and no money. Hopefully, you know what went wrong so you don't make that mistake again. If not, be sure to figure it out.
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
answered Feb 10 at 2:07
Ben MillerBen Miller
82.2k21225295
82.2k21225295
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
add a comment |
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
6
6
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
No details yet, but I had read the IRS will negotiate the time for those in this situation, although there may be a limit, like $10K. Edit - The change for 2018 is the 90% threshold for penalty. That has been reduce to 85%, i.e. if one has paid 85% of final tax bill, no penalty. I can't find a change for payment plans.
– JoeTaxpayer♦
Feb 10 at 3:06
1
1
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
A loan from my 401k is at 6.5% right now and I would pay that back to myself.
– AbraCadaver
Feb 11 at 21:46
add a comment |
Ben is right as far as your options. I'd use the IRS payment plan. You're allowed to use a payment plan every few years I believe. I owed around that amount ($18K) and was able to make $2K a month payments. I don't remember exactly what the fees were, but it wasn't much. That allowed me time to make additional income as I'm always paying $20K a year in taxes.
Pay what you can in the next 2 months and get a payment plan. If you're going to be in the same scenario again, start putting back money as you can.
Best of luck.
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
add a comment |
Ben is right as far as your options. I'd use the IRS payment plan. You're allowed to use a payment plan every few years I believe. I owed around that amount ($18K) and was able to make $2K a month payments. I don't remember exactly what the fees were, but it wasn't much. That allowed me time to make additional income as I'm always paying $20K a year in taxes.
Pay what you can in the next 2 months and get a payment plan. If you're going to be in the same scenario again, start putting back money as you can.
Best of luck.
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
add a comment |
Ben is right as far as your options. I'd use the IRS payment plan. You're allowed to use a payment plan every few years I believe. I owed around that amount ($18K) and was able to make $2K a month payments. I don't remember exactly what the fees were, but it wasn't much. That allowed me time to make additional income as I'm always paying $20K a year in taxes.
Pay what you can in the next 2 months and get a payment plan. If you're going to be in the same scenario again, start putting back money as you can.
Best of luck.
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
Ben is right as far as your options. I'd use the IRS payment plan. You're allowed to use a payment plan every few years I believe. I owed around that amount ($18K) and was able to make $2K a month payments. I don't remember exactly what the fees were, but it wasn't much. That allowed me time to make additional income as I'm always paying $20K a year in taxes.
Pay what you can in the next 2 months and get a payment plan. If you're going to be in the same scenario again, start putting back money as you can.
Best of luck.
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
answered Feb 10 at 3:51
Richard HaleRichard Hale
512
512
add a comment |
add a comment |
Thanks for contributing an answer to Personal Finance & Money Stack Exchange!
- Please be sure to answer the question. Provide details and share your research!
But avoid …
- Asking for help, clarification, or responding to other answers.
- Making statements based on opinion; back them up with references or personal experience.
To learn more, see our tips on writing great answers.
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function () {
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmoney.stackexchange.com%2fquestions%2f105138%2fwhat-is-the-best-way-to-pay-large-tax-amount-owed-to-irs%23new-answer', 'question_page');
}
);
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
5
Do you have sufficient credit rating to open a new credit card with a 0% promotional APR? 18.24% is completely unreasonable especially on top of 2% up-front for the convenience fee, but a promotional APR can make paying taxes on credit card very reasonable.
– Ben Voigt
Feb 10 at 1:19
30
Did you have a windfall or are you self-employed and haven't been paying estimated taxes throughout the year?
– Hart CO
Feb 10 at 2:00
10
Compare 18.24 percent and 3 percent. Compare 39% to 3%.
– gnasher729
Feb 10 at 12:44
2
You didn't mention when you will actually have the money (and how solid that plan is). E.g. tax payment on April 15th, money becomes available on April 19th, credit card due on May 10th is a very different calculation from "I have no idea how I'll ever get the money".
– user3067860
Feb 10 at 16:15
3
@gnasher729 it's not quite as simple as comparing rates. I also have to consider my ability to pay an additional amount per month. If I were to withdraw the correct amount from my 401k, I'd have nothing to pay off.
– Mark
Feb 10 at 18:38