A practical guide for business owners and freelancers
Overview
If you searched how to pay quarterly taxes as a freelancer, quarterly estimated taxes for small business, or estimated taxes for S Corp owners, you are not behind — you are running into a system that was never explained clearly.
Quarterly estimated taxes are one of the most common sources of penalties, cash flow stress, and surprise tax bills for freelancers, consultants, and business owners. The issue is rarely effort. It’s almost always guessing instead of planning.
This guide explains how quarterly taxes actually work, who needs to pay them, and how working with a CPA turns them from a constant stressor into a predictable system.
What quarterly estimated taxes actually are
Quarterly estimated taxes are prepayments of income tax (and sometimes self-employment tax) that the IRS expects throughout the year when taxes are not withheld from a paycheck.
They typically apply to:
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freelancers and independent contractors
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self-employed professionals
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LLC owners
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S Corp owners on pass-through income
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anyone with significant income not subject to withholding
Unlike W-2 employees, business owners are responsible for sending tax payments during the year instead of settling everything in April.
According to the Internal Revenue Service, estimated taxes are required when you expect to owe at least $1,000 in tax after withholding and credits.
Why so many people get quarterly taxes wrong
The most common mistakes we see include:
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paying nothing and hoping for the best
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paying last year’s amount without adjusting for growth
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ignoring income spikes or slow periods
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forgetting state estimated taxes
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assuming S Corp owners don’t need to pay estimates
The IRS does not care whether income was predictable or not. If payments are too low, penalties and interest can apply, even if you pay everything at filing time.
How quarterly tax deadlines work
Estimated tax payments are typically due:
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April
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June
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September
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January
Missing or underpaying these deadlines is one of the fastest ways business owners accumulate penalties. The IRS views taxes as a “pay as you go” system.
How a CPA calculates quarterly taxes correctly
A CPA does not guess. They calculate estimates using:
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current year income and expenses
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prior-year safe harbor rules
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filing status and credits
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withholding from any W-2 income
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cash flow timing
This prevents both underpayment penalties and unnecessary overpayments that strain cash flow.
At Avocet International CPAs, we focus on making quarterly taxes:
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predictable
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proportional to income
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adjustable as the year changes
Do S Corp owners still pay quarterly taxes?
Yes — and this is a common misunderstanding.
While S Corps run payroll for owners, pass-through income is still taxed at the individual level. Many S Corp owners still need to make quarterly estimated payments depending on:
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salary level
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profit distribution
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withholding accuracy
This is why entity structure and tax planning must work together.
How quarterly planning improves cash flow
When quarterly taxes are planned properly:
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you know what to reserve each month
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April stops being a shock
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cash flow becomes easier to manage
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financial decisions feel safer
Quarterly taxes should feel like a system — not a recurring emergency.
Suggested links to include
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Internal Revenue Service – Estimated taxes
https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes -
Internal Revenue Service – Underpayment penalties
https://www.irs.gov/payments/underpayment-of-estimated-tax-by-individuals-penalty
FAQ
What happens if I skip quarterly taxes?
You may owe penalties and interest, even if you pay your balance at filing time.
How do I calculate quarterly taxes accurately?
It depends on income, deductions, withholding, and filing status. Guessing is risky.
Do S Corp owners pay estimated taxes?
Often yes, depending on profit and withholding.
