The U.S. tax system is pay-as-you-go. Employees satisfy this through withholding. If you have income with no withholding — self-employment, rental income, investment gains, retirement distributions — you may need to make quarterly estimated payments.
Who generally needs to pay
If you expect to owe $1,000 or more when you file, estimated payments are generally required. The safe way to avoid penalties is to pay at least 90% of the current year's tax, or 100% of last year's (110% for higher incomes), through withholding and estimates.
The deadlines
Quarterly payments are typically due in April, June, September and January. Missing them triggers an underpayment penalty — not enormous, but entirely avoidable.
Getting the number right
Estimates based on last year's return are the simplest safe harbor. If your income is growing fast or uneven, a projection partway through the year keeps you accurate without overpaying. This is one of the most valuable conversations to have before year-end, not after.
Your situation
General information only — your return may differ. If this article sounds like your situation, let's look at it properly.
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