Quarterly Estimated Tax Calculator

Use this calculator to estimate quarterly federal tax payments for self-employed individuals and small business owners. Essential for staying compliant with IRS payment deadlines, avoiding underpayment penalties, and planning cash flow around tax obligations.

What this calculator does

The quarterly estimated tax calculator helps you estimate the federal tax payment due each quarter on self-employment and other untaxed income.

It uses:

• expected annual net income
• estimated federal income tax rate
• estimated self-employment tax rate

This gives you the estimated total annual tax owed and the quarterly payment amount — the figures needed to file IRS Form 1040-ES on time and avoid underpayment penalties.

Quarterly Estimated Tax Formula

Quarterly Payment = (Annual Income Tax + Annual SE Tax) ÷ 4

Where:

• Annual Income Tax = expected federal income tax for the year
• Annual SE Tax = self-employment tax on net earnings (15.3% with 92.35% adjustment)
• Quarterly Payment = total annual tax divided by four equal instalments

Example calculation

If:

• Expected annual net income = 80,000
• Estimated federal income tax rate = 22%

Then:

• Income tax = 80,000 × 0.22 = 17,600
• SE tax = 80,000 × 0.9235 × 0.153 ≈ 11,302
• Total annual tax = 17,600 + 11,302 = 28,902
• Quarterly payment = 28,902 ÷ 4 ≈ 7,226

The quarterly estimated tax payment is approximately 7,226 — due four times per year to the IRS using Form 1040-ES.

What are quarterly estimated tax payments?

Quarterly estimated tax payments are advance payments of federal tax owed by individuals who do not have sufficient tax withheld from a paycheck. The IRS requires these payments from self-employed workers, freelancers, investors, and others with significant untaxed income. Payments are due four times per year — typically 15 April, 15 June, 15 September, and 15 January of the following year.

Why quarterly estimated tax matters

Paying estimated tax on time helps you:

• avoid IRS underpayment penalties charged when too little tax is paid during the year
• spread the tax burden across four manageable payments instead of one large April bill
• comply with the IRS pay-as-you-go requirement for self-employment income
• maintain accurate cash flow planning by treating tax as a regular business expense

When to use this calculator

Use this calculator when you want to:

• estimate the quarterly amount due on freelance, contractor, or business income
• plan tax payments alongside other business cash flow obligations
• check whether current withholding from any W-2 income covers your full tax liability
• adjust mid-year payments after a significant change in projected income

Common mistakes when calculating quarterly estimated tax

Common mistakes include:

• forgetting to include self-employment tax on top of federal income tax
• calculating quarterly tax on gross revenue rather than net income after business expenses
• ignoring state estimated tax obligations, which are filed separately from federal
• missing payment deadlines and incurring underpayment penalties even when total annual tax is eventually paid

Quarterly estimated tax vs annual tax filing

These are two different stages of the same tax obligation.

• Quarterly estimated tax is the prepayment of expected annual tax in four instalments during the year
• Annual tax filing reconciles total tax owed against amounts paid through the year and produces either a refund or a balance due

Use the Self-Employment Tax Calculator to break out the SE tax component, and the Income Tax Bracket Calculator for the income tax portion.

FAQs

What is quarterly estimated tax?

Quarterly estimated tax is an advance payment of federal tax owed by individuals with income not subject to withholding — most commonly self-employed workers, freelancers, and investors. Payments are due four times per year using IRS Form 1040-ES.

How do you calculate quarterly estimated tax?

Estimate your total annual federal income tax plus self-employment tax, then divide by four. For 80,000 in net self-employment income at a 22% income tax rate, the quarterly payment is approximately 7,226.

What is a good rule of thumb for setting aside quarterly tax?

Many self-employed workers set aside 25% to 30% of each payment received to cover quarterly tax. The exact figure depends on income bracket, state tax rates, and deductions.

What is the difference between quarterly estimated tax and tax withholding?

Tax withholding is automatic deduction from W-2 wages by an employer. Quarterly estimated tax is a manual payment made by individuals whose income is not subject to withholding. Both serve the same purpose — paying tax during the year rather than in one lump sum at filing.