Like cleaning rain gutters, ensuring the proper amount of tax is paid with Estimated Payments is something you know you must do, but it is a thankless task that no one really wants to do, much less do it every 3 or so months.
The data used to compute Estimated Payment liability may originate from those tasked with the tax provision, while the vouchers might be generated by those tasked with the tax returns. This means the responsibility for Estimated Payments can potentially fall in between two groups within the tax department and ends up being something neither wants to do.
Working on Estimated Payment is often thought of a no win proposition. Without imploring a crystal ball, it is difficult to not end up with either an overpayment or an underpayment. Overpayments restrict cash flow and underpayments could lead to non-deductable penalties. Similar to maintaining your rain gutters where you’ll get no compliment for keeping them clean, but if you don’t spend a weekend or two pulling out leaves and sticks you’ll potentially have water damage.
Traditionally Estimated Payments was a manual process that took considerable amounts of resources just to get the right data and produce the vouchers. Many take the position of ‘playing it safe’ and round up to err on the side of overpaying to avoid penalties. Very few in the tax department will willingly volunteer for this job since it takes considerable effort and the benefits are few.
The new Estimated Payments integrated functionality in ONESOURCE allows tax data to be repurposed from either the return or provision and produces vouchers that are more accurate and take less effort. The module allows data needed to flow in, uses intuitive processing rules and easily generates all necessary vouchers which allows the effort & time to be dramatically reduced. Imagine if there was a tool that allowed you to clean your rain gutters while you sat comfortably in a lawn chair!