Many of the tax-related questions we hear most often are about estimating and paying quarterly taxes: what are they, do I have to pay them, and how do I do it?

If you work for an employer, chances are your income tax is withheld from your wages, in which case you won’t have to worry about making estimated quarterly tax payments. But if you’re not in that boat, you may be wondering how and when to make those payments. TaxGlobal is here to help.

Do I have to make estimated payments?

If you expect to pay at least $1000 in taxes, and if your income tax is not withheld from your wages, you may be required to make quarterly income tax payments. You may qualify if:

• You are a freelancer, entrepreneur, or small business owner
• You make a significant amount of money from investments or gambling
• You receive unemployment benefits or taxable retirement plan withdrawals

If you do fall into one of these categories, and, again, you expect to pay $1000 or more in taxes for the next year, then you’ll want to estimate and pay your taxes quarterly in order to avoid interest and penalties when filing your tax return.

When do I pay my estimated taxes?

Estimated taxes are due in four periods throughout the year. For 2023, the dates are as follows:

• January 1 - March 31: Due April 18, 2023
• April 1 - May 31: Due June 15, 2023
• June 1 - August 31: Due September 15 2023
• September 1 - December 31: Due January 15, 2024

How do I pay my estimated taxes?

You can pay your estimated taxes to the IRS via mail or online using the Electronic Tax Payment System (EFTPS), provided for free by the U.S. Department of the Treasury. Simply pay before the due date for each quarter, and you’re good to go. You can also pay by credit or debit card via phone or the IRS’ website. Don’t forget to also pay your estimated state taxes, if necessary.

Occasionally, you may overestimate your amount owed. In this case, you can always roll the excess over into your next payment, or simply receive it as part of your refund.

Tips for simplifying the process

Paying your estimated taxes isn’t too much of a challenge once you get into the hang of it. Here are a few tips to smooth things out for you.

1. Put money aside for estimated taxes as you receive it, this way you won’t be caught short later on.
2. Set reminders in your phone or calendar for payment due dates so you don’t miss them.
3. Recalculate what you owe once every quarter in case things have changed or you’ve made a miscalculation.

Follow these tips and paying your quarterly taxes doesn’t have to be a hassle. Remember, if you need help estimating or filing your taxes, our global community of CPAs can help!