Tax Escrow Details

As a self-employed individual you are responsible for determining the amount and arranging for the payment of your own federal and state estimated tax payments.

NICA provides a federal and state tax escrow program to affiliated Independent Contractors to assist in saving for and making quarterly estimated income tax payments to the IRS and state tax authorities. This estimated payment to the IRS also includes your Social Security and Medicare Tax requirement.

If you sign up for the federal escrow program and or the state escrow program, the amount that you decide to deduct each month will be paid quarterly to the IRS and or the state authority as your estimated income tax payments.

The payments are made by NICA as follows:

Quarter	Date Paid	Amount Paid
1	April 15	Escrow balance as of March 31
2	June 15	Escrow balance as of May 31
3	September 15	Escrow balance as of August 31
4	January 15	Escrow balance as of December 31

The amount that is paid is an “estimate” only. Your actual tax owed is determined at the end of the year when your tax return is prepared. The payments are reported on your tax return as “estimated payments” and are deducted from your actual tax owed.

Have a question pertaining to this service? Ask the NICA Tax Department.