I made about 7 to 8 thousand U.S. dollars this year from gambling, and I am wondering whether it would make sense for me to make a lump estimated tax payment before New Year's (in case something like this exists?). Would one save any money on self-employment fees if one did this type of thing instead of paying regularly by April? Any thoughts are welcome, thanks.

Edit: Since I am self-employed, I don't have any employer deductions helping me out.

You will owe the same taxes no matter what, but you might have fees if you *don't* pay quarterly. It depends a lot on your situation, including how much you owed last year (and if you payed that), or how much you owe (small amounts generally will get you an exemption on penalties).

You'll have to run this all for your situation to know how exactly it will affect you, though it might already be too late, since you didn't pay for the first 3 Q's of the year.

OP - it depends on when you made the gambling income, what your prior year tax liability was, and what your current year tax liability is projected to be. If you have either 90% of your current year tax liability or 100% of your prior year tax liability paid in as estimated taxes, you should be OK. You can also request to have any penalties waived if you made the $8k as a lump sum (i.e. a tournament score). I'm a CPA btw, so if you have more questions you can PM me.

Thanks for the replies everyone. I think to keep things simple, I will likely just pay without estimation for this year, and then begin to pay estimated starting next year. I am hoping that the difference won't be that great.

I understand the estimated quarterly situation and I pay it with no issue. My income is going down next year but they will base my estimated on last year (or current year). How do I get around this? If I was making $200,000 in 2014 but expect to make $150,000 in 2015, how will they estimate quarterly taxes?

cap: I believe you have to pay either 100%/110% of last year's tax (depending on your income, in your case it would be 110%) or 90% of this years tax. You can double check on the IRS website.

quick tax question for you guys - there's a penalty for not filing a quarterly - if you underpay that quarterly will you be able to avoid the penalty? For example if you owe say 40,000 in taxes and pay 2500 on a quarter. Just wondering cause if thats the case it would be a big mistake not to pay the quarterly

Penalty is assessed on the shortfall

I've never paid quarterly, usually lump sum at the end of the year based on an estimate of what I've made. I can't remember ever caring about any type of penalty. It's mostly just interest, yeah? And interest rate is super low.

OP, when you say self-employed, what do you mean? You can deduct "business" expenses related to that 8k to reduce your tax liability, if such expenses exist. Did you use your cell phone for that income? Did you travel to earn that income? You can deduct percentages of bills. That income may not necessarily be SE income unless certain thresholds are met. SE income actually isn't good since you owe extra taxes on it...the sole advantage to SE/Schedule C income is being able to net income and expenses.

I've filed self employed taxes on poker for the past 7 years. I always just wait till the year is over and pay it as a lump sum, instead of quarterly. The penalty is low. If i remember right, its never been over $200~.