Quarterly or Yearly

Is there any benefit to paying taxes quarterly?

The benefit goes to the IRS, not the tax payer. Our tax system is "pay as you go" plan, so it is presumed by the IRS that taxes are due when income is earned.

The only "advantage" to the taxpayer is the avoidance of a tax penalty for excessive withholding. If the IRS determines that you have withheld too little of your income as you earned it, they will assess a penalty on your return. This is why self-employed individuals make quarterly payments...they don't have taxes being withheld by an employer.

Other than for the Roth IRA, my rule of thumb is delay, delay, delay (for as long as is legally possible). There are a couple of other highly limited situations where I might consider violating my rule, but I haven't run into them yet.

Rules for estimated tax payments:

There are 3 safe harbors available to avoid any penalty for having too little paid for income tax via tax withholding, or estimated payments.

The first safe harbor is quite easy, you know the target amount:
- Will withholding plus credits equal the tax on 1040 line 46 of the previous year's tax return?

The second:
- Will withholding plus credits be $1,000 or less than the tax on your current tax return, 1040 line 46.

The third:
- Will withholding plus credits be at least 90% of your current tax, 1040 line 46.

If you can answer YES to any one of these situations, you are not required to make estimated payments.

But then we are to pay the tax as we receive our income....