Estimated tax payments are crucial for business owners, freelancers, and investors who don’t have taxes withheld from their income. Missing a payment can result in non-deductible penalties, but with proper planning, you can avoid unnecessary fees. McFadden Accounting is here to guide you through the process and ensure you stay compliant.
For the 2024 tax year, payments are due on:
For the 2025 tax year, payments are due on:
To avoid IRS penalties, you must pay at least 90% of your current year’s tax liability or 100% of your prior year’s tax liability (110% if your adjusted gross income (AGI) exceeded $150,000 in the prior year).
Make timely payments using IRS Direct Pay or EFTPS (Electronic Federal Tax Payment System), both secure and convenient methods to ensure your tax payments are on time.
If your income fluctuates, you can use the annualized income method to align estimated payments with earnings. If you’ve missed a payment, making a catch-up payment will stop further penalties from accruing, though it won’t eliminate previously assessed penalties.
Managing estimated tax payments can be complex, but McFadden Accounting is here to help you avoid costly mistakes.
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