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Quarterly Tax Survival Guide for the Self-Employed


If you’re self-employed, a landlord, or earn income from investments, you’re likely required to make quarterly estimated tax payments. These cover income tax and self-employment tax—and skipping them or miscalculating can lead to IRS penalties.


Who Needs to Pay?


This includes freelancers, gig workers, business owners, S corp shareholders, landlords, and investors. If you expect to owe $1,000 or more in taxes after credits and withholdings, estimated taxes apply.



Key Due Dates:

  • April 15: For income from Jan 1–Mar 31

  • June 15: For income from Apr 1–May 31 (June 16 in 2025)

  • September 15: For income from Jun 1–Aug 31

  • January 15 (following year): For income from Sep 1–Dec 31


How to Calculate

  1. Estimate total annual income.

  2. Subtract deductions (standard/itemized, retirement, etc.).

  3. Apply federal tax rates.

  4. Add self-employment tax (15.3% up to $176,100 in 2025).

  5. Subtract credits/withholding.

  6. Divide by four (or use the annualized method if income fluctuates).


Avoiding Penalties

You’re typically safe if you pay:

  • 90% of this year’s tax, or

  • 100% of last year’s tax (110% if AGI > $150k).


If you also have W-2 income, increasing paycheck withholding can reduce or eliminate your need to make estimated payments.


Smart Habits

  • Save 25–30% of net income for taxes.

  • Use software like QuickBooks or Xero.

  • Automate payments through IRS Direct Pay or EFTPS.


Staying compliant with estimated taxes doesn’t have to be stressful—especially with expert guidance.


📩 Need help calculating or planning your quarterly payments? Contact Verity CPAs at info@verity.cpa or 808.546.5026 for proactive, penalty-proof support.

 
 
 

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