Quarterly Estimated Tax Calculator

You must pay quarterly estimated taxes if you expect to owe $1,000 or more in federal tax for the year after subtracting withholding and refundable credits. This applies to self-employed individuals, freelancers, sole proprietors, partners, and S-Corp shareholders who receive distributions. If you have a W-2 job that withholds enough tax to cover your liability, you may not need to make estimated payments.

The IRS charges an underpayment penalty calculated at the federal short-term rate plus 3 percentage points, applied to the amount underpaid for each quarter. The penalty is calculated separately for each quarter, so a late Q1 payment accrues more interest than a late Q4 payment. You can avoid the penalty entirely by meeting either safe harbor threshold: paying at least 100% of your prior-year tax (110% if AGI exceeded $150,000), or paying at least 90% of your current-year tax.

Safe harbor protects you from underpayment penalties even if you owe tax at filing time. There are two methods: pay at least 90% of your current-year tax liability, or pay at least 100% of last year's total tax (110% if your prior-year AGI was above $150,000). Most self-employed people use the prior-year method because it's predictable—you know exactly what to pay regardless of income fluctuations.

Self-employment tax is 15.3% of 92.35% of your net self-employment income. This covers Social Security (12.4% on income up to $176,100 in 2026) and Medicare (2.9% on all income). If your income exceeds $200,000 ($250,000 married filing jointly), you also pay an additional 0.9% Medicare surtax. Half of your SE tax is deductible on your income tax return, which reduces your taxable income.

Yes, you can adjust payments each quarter. If your income increases mid-year, you can increase later payments. If income drops, you can reduce them. The IRS annualized income installment method (Form 2210 Schedule AI) lets you calculate each quarter based on income actually earned in that period. This is especially helpful for seasonal businesses or freelancers with uneven income.

Most states with an income tax require separate quarterly estimated tax payments on a similar schedule. The thresholds and due dates vary by state. This calculator focuses on federal estimated taxes only. Check your state's Department of Revenue website for state-specific requirements, or add your state tax rate as an additional deduction consideration.