Estimated Quarterly Tax Calculator
Use this free estimated quarterly tax calculator to decide how much you may want to pay for your federal quarterly tax payment.
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Calculate Your Estimated Quarterly Taxes With Ease
Staying on top of your tax liability is essential for financial success as a small business owner. Our estimated quarterly tax calculator is designed to help you quickly estimate your quarterly tax payments by simply entering your business information.
While it’s still necessary to work with a tax professional who understands your business and can offer personalized advice, keeping our quarterly tax calculator handy can help you stay on track with quarterly payments and help you prepare for the upcoming tax season.
Why tracking estimated quarterly taxes matters
Estimating and paying your quarterly taxes is crucial as it ensures you avoid penalties for underpayment, which can be costly if neglected or misestimated. It also helps you effectively manage your cash flow by ensuring you have the funds set aside for your tax obligations throughout the year. Taking a proactive approach keeps you compliant with IRS requirements and significantly reduces stress come tax season.
Moreover, regular tracking of estimated quarterly taxes gives you a clear picture of your business’s overall financial health. It encourages a more consistent review of income and expenses, leading to better financial decision-making, and it saves you from the shock of a large lump sum payment at the end of the tax year.
Ultimately, tracking your estimated quarterly taxes keeps your business organized and in a more stable financial position.
How our estimated quarterly tax calculator works
Our user-friendly calculator provides a quick and secure estimate of your quarterly tax payments based on your business’s financial information.
To use our estimated quarterly tax calculator, follow the steps and enter the following information:
1. Your business structure for tax filing purposes (sole proprietor, C corp, partnership, or S corp)
2. Expected filing status for the year
3. Projected total income and adjustments (e.g., healthcare, retirement contributions)
4. The choice between taking the standard deduction or itemizing your deductions
5. Estimated amount of self-employed tax deductions
6. Qualified Business Income (QBI) deduction estimate (if applicable)
7. Estimated tax credits (e.g., child and dependent care tax credit)
8. Your name and email address
In just a few simple steps, you'll receive an estimate of your quarterly tax payments sent securely to your inbox.
What our calculator cannot do
While our estimated quarterly tax calculator provides a helpful estimate, it's important to note that it cannot:
- Provide an exact total of your quarterly tax liability
- Account for complex tax situations or unusual circumstances
- Replace professional tax advice
For personalized tax guidance, quarterly tax filing assistance, and comprehensive financial services, consider partnering with Bench Accounting. Our accounting and bookkeeping experts are ready to support your business's unique bookkeeping and income tax needs.
Quarterly tax calculation differences between business structures
Quarterly tax calculations vary depending on your business structure. Here’s a quick overview of what your estimated quarterly taxes include based on each business structure:
- Sole proprietorships and single-member LLCs: You pay self-employment tax and income tax on all profits
- Partnerships and multi-member LLCs: Partners pay self-employment tax and income tax on their share of profits
- S corporations: Shareholders pay income tax on their share of profits but only pay self-employment tax on their salary
- C corporations: The corporation pays corporate income tax, and shareholders pay income tax on dividends
How to make quarterly tax payments
Making quarterly estimated tax payments is a pretty straightforward process that can be done in one of three ways:
1. Using the IRS Direct Pay system or EFTPS (Electronic Federal Tax Payment System)
2. Mailing a check or money order to the IRS with Form 1040-ES
3. Paying with a credit or debit card through an approved payment processor
Remember to make payments by the quarterly due dates to avoid penalties.
Further reading: Estimated Tax Payments—Deadlines and How to Pay
Best practices for quarterly taxes: FAQs
What percentage should I take out for quarterly taxes?
As a general rule, set aside 25 to 30% of your net income for taxes. This percentage may vary based on your tax bracket and specific business situation, but setting aside up to 30% should have you covered.
What is the 90% "safe harbor" rule for estimated taxes?
To avoid IRS penalties for underpayment of quarterly taxes, your estimated tax payments must be at least 90% of your current year's tax liability or 100% of your previous year's tax liability. (110% if your adjusted gross income was over $150,000).
Can you overpay on estimated tax payments?
Yes, it’s possible to overpay your estimated taxes. While this ensures you won't face penalties, it essentially means you're giving the government an interest-free loan. Being as accurate as possible in your tax estimates ensures that you’re optimizing your business’s cash flow and not giving Uncle Sam a freebie.
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Note: This quarterly tax calculator only computes federal taxes. If you live in a state that charges income tax, you may also need to set up quarterly state tax payments.
Learn more about estimated quarterly taxes
How to Calculate and Pay Federal Estimated Taxes
A complete guide to paying federal estimated quarterly taxes, including who is required to pay them, how to pay, deadlines, and what happens if you miss the payment deadline.
IRS Form 1040-ES, Estimated Income Tax: A Guide
When you pay income tax in quarterly installments, individuals use IRS Form 1040-ES to report how much money you’re sending to the government. We walk through the process of filling out this form.
IRS Form 2210: Calculating Underpayment of Estimated Tax
While the IRS will send you a notice about the penalty themselves, you can use IRS Form 2210 to determine whether you owe a penalty, calculate how much that penalty will be, and pay your penalty using your tax return.
Frequently Asked Questions
Quarterly taxes are due on the 15th of April, June, September and January (of the following year). If the 15th falls on a weekend or legal holiday, then quarterly tax payments are due the next business day.
Looking at how these deadlines apply during the annual tax year:
- For the period Jan 1 to March 31: April 15
- For the period April 1 to May 31: June 15
- For the period June 1 to August 31: September 15
- For the period September 1 to December 31: January 15 of the following year
If you underpay your estimated taxes, the IRS may impose penalties. Fortunately, the penalty doesn't begin until you owe $1,000 or more in taxes.
You can avoid an IRS underpayment penalty by paying 100% of your business's tax liability from the previous year as estimated payments for the current year. This means you would pay the same amount as your tax obligation last year, throughout the current tax year.
If your gross income exceeds $150,000, you can avoid potential penalties by paying 110% of your previous year’s tax obligation as your estimated payments for the current year.
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