The Internal Revenue Service penalty for tax underpayments has nearly tripled since 2021, putting gig economy workers and consultants at the largest risk of having to cough up big bucks to Uncle Sam. As of Oct. 1, the IRS will now charge 8% interest on estimated tax underpayments, up from 3% two years ago, according to The Wall Street Journal.

Penalties will largely apply to pay-as-you-go workers who do not have taxes withheld and fail to make estimated quarterly payments before filing their taxes in April.

Fines can be avoided by paying at least 90% of one’s tax bill before filing, or having less than a $1,000 difference — whichever sum is higher, according to the IRS.

Read more as it was reported in the New York Post.

All told, J Rosio Tax Services professionals are here to guide your small business through challenges exactly like these.