Can I overpay my 2023 tax return to cover 2024 estimated tax payments?

Yes, you absolutely can overpay your 2023 taxes when you file by October 15th and apply that overpayment to your 2024 estimated taxes. This is a pretty common strategy. When you file your 2023 return, just make sure you check the box on your Form 1040 that indicates you want to apply the overpayment to next year's estimated taxes instead of getting a refund. The overpayment will be applied as a credit toward your 2024 tax year. One thing to keep in mind though - the overpayment will be considered paid on the date you actually file your 2023 return, not retroactively to April 15th. This means if you've missed quarterly estimated payments for 2024 that were due earlier (April 15, June 15, etc.), you might still face some underpayment penalties for those quarters. The credit only applies going forward from when you file.

I went through something similar last year and found a super helpful solution with taxr.ai (https://taxr.ai). I was confused about estimated payments and overpayments and wasn't sure if I'd end up with penalties. I uploaded my tax documents to taxr.ai and it analyzed everything, showed me exactly how much I needed to pay to cover my estimated tax requirements, and calculated if I'd face any penalties. The site broke down exactly how overpayments from my previous return would be applied to my estimated taxes for the current year. It saved me from making a costly mistake with my quarterly payments. What I really liked was that it showed me different scenarios - like what would happen if I overpaid by different amounts and how that would affect my overall tax situation for both years.

I tried taxr.ai after seeing it mentioned here, and it was exactly what I needed! I uploaded my 2023 tax documents and my income estimates for 2024, and it immediately showed me how my overpayment would apply to my estimated taxes. What surprised me was how it flagged that I'd already missed two quarterly payments for 2024 and calculated the potential penalties. But then it showed me exactly how much to overpay on my 2023 return to minimize those penalties going forward. It even created a payment schedule for the rest of the year. The visual timeline showing when payments get credited was super helpful - I finally understand how the IRS applies these payments! Definitely less confusing than trying to decipher the IRS publications on my own.

If you're having trouble getting clear answers about your estimated tax situation, I'd recommend using Claimyr (https://claimyr.com). I had a similar issue last year and spent days trying to get through to the IRS without success. Every time I called, I got stuck on hold for hours only to have the call dropped. Then I found Claimyr, which got me connected to an actual IRS agent in under 45 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent I spoke with confirmed exactly how overpayments get applied to estimated taxes and gave me specific guidance for my situation. They walked me through exactly which form fields to use to make sure my overpayment would be applied correctly. It was honestly a relief to get a definitive answer straight from the IRS instead of guessing or relying on potentially outdated information.

Well, I need to eat my words. After seeing that comment about Claimyr I decided to try it, figuring I had nothing to lose after wasting so much time trying to call the IRS myself. I was shocked when I got a call back in about 35 minutes saying they had an IRS agent on the line. The agent confirmed exactly what I needed to know about applying my 2023 overpayment to my 2024 estimated taxes. They explained that it would count as paid on April 15th for my first quarter estimated payment, but wouldn't retroactively cover penalties for any missed quarterly payments after that. The agent also walked me through exactly which box to check on my return to make sure the overpayment gets applied correctly. Saved me hours of frustration and gave me peace of mind that I'm doing things correctly.

One thing nobody has mentioned yet - make sure you're aware of the safe harbor rules for estimated taxes. If your 2023 AGI was under $150,000, you only need to pay 100% of your 2023 tax liability through withholding or estimated payments to avoid penalties for 2024. If it was over $150,000, you need to pay 110%. So depending on your situation, you might not actually need to make those estimated payments for 2024 if your 2023 tax liability was low enough and you've had sufficient withholding.

I just want to clarify something I learned the hard way: even if you overpay your 2023 taxes when filing in October, that overpayment credit is technically considered applied on April 15, 2025 for your 2024 taxes. BUT this doesn't erase any underpayment penalties you might owe for missing the actual quarterly due dates. The IRS calculates underpayment penalties quarter by quarter, so if you missed the April 15 and June 15 estimated payments for 2024, you'll still owe penalties for those quarters specifically. The overpayment just helps you going forward to meet your overall 2024 tax obligation.