What quarterly tax payments are and who needs to make them

A quarterly tax payment is a payment you send to the IRS (or your state tax agency) four times a year if you owe taxes that won't be withheld from a paycheck. Most people who work as employees have taxes taken out automatically, so they don't make quarterly payments. But if you're self-employed, a freelancer, a gig worker, or you have income from investments or rental property, you may need to send in estimated tax payments every three months.

The IRS expects you to pay taxes as you earn money throughout the year, not just once at tax time. If you don't pay quarterly and owe a large amount when you file your return, you may owe a penalty on top of the taxes themselves. The penalty is small — usually a few dollars unless the amount owed is very large — but it's avoidable if you pay on schedule.

You're required to make quarterly payments only if you expect to owe $1,000 or more in federal taxes for the year. State requirements vary; some states have lower thresholds or don't require them at all. If you're unsure whether you need to pay, the safest approach is to calculate your expected income for the year and compare it to your tax liability from last year.

Key Takeaways

  • Quarterly tax payments are due on April 15, June 15, September 15, and January 15 of the following year, though the exact date shifts slightly if it falls on a weekend or holiday.
  • You can pay online through IRS Direct Pay or the Electronic Federal Tax Payment System (EFTPS), by mail with Form 1040-ES, or by phone.
  • Each payment should cover roughly one-quarter of your expected annual tax liability, though you can adjust the amount if your income changes during the year.
  • Missing a quarterly payment important date does not prevent you from filing your tax return on time, but it may result in a small penalty when you file.
  • Keeping records of what you paid and when helps you avoid overpaying or underpaying when you file your annual return.

The four quarterly payment due dates

The IRS sets four fixed due dates each year. For 2024, they are April 15, June 15, September 15, and January 15 of the following year. If any of these dates falls on a weekend or federal holiday, the important date moves to the next business day. For example, if April 15 is a Sunday, your payment is due Monday, April 16.

The first quarter covers January through March. The second quarter covers April through May. The third covers June through August. The fourth covers September through December. You don't need to file any form to make a quarterly payment — you straightforward send the money by the important date. The IRS will match it to your account when you file your annual return.

State tax important date often match the federal dates, but not always. If you owe state income tax, check your state's tax agency website for the exact dates. Some states use different schedules or have different rules for who must pay quarterly.

How to pay online through IRS Direct Pay

IRS Direct Pay is the fastest and most straightforward way to send a quarterly payment. You go to the IRS website (irs.gov), find the Direct Pay tool, and enter your payment information. You'll need your Social Security number or Employer Identification Number (EIN), your filing status, and the amount you want to pay. The tool lets you schedule a payment for a future date if you want to pay before you have the cash on hand.

Direct Pay is free — the IRS doesn't charge a fee. The payment comes directly from your bank account, and you get a confirmation number when ready. You can pay up to $100,000 per day. If you're paying for a business, you'll use your EIN instead of your Social Security number.

One limitation: Direct Pay works only if you have a U.S. bank account. If you don't, or if you prefer a different method, the IRS offers other options.

How to pay through EFTPS or by credit card

The Electronic Federal Tax Payment System (EFTPS) is another free online option run by the U.S. Department of the Treasury. You set up an account on the EFTPS website, link your bank account, and schedule payments. EFTPS requires you to enroll at least one business day before you want to make a payment, so it's better for planned, recurring payments than for last-minute ones.

If you want to pay by credit or debit card, you can do so through a third-party payment processor. The IRS website lists approved processors. These companies charge a fee — usually 1.87% to 2.35% of the payment amount — because the IRS doesn't accept card payments directly. For a $5,000 quarterly payment, the fee would be roughly $94 to $118. The fee is not tax-deductible.

Paying by card can make sense if you're earning rewards points or cash back, or if you need to build a credit history. Otherwise, Direct Pay or EFTPS is cheaper.

How to pay by mail with Form 1040-ES

If you prefer to pay by check or money order, you can mail your payment with Form 1040-ES, the Estimated Tax Worksheet. You fill out the form, write your check, and mail both to the IRS address listed in the form instructions. The address varies by state, so don't guess — check the current form.

Include your name, address, Social Security number, and the tax year on your check. Write "2024 Q2 Estimated Tax" (or whichever quarter) on the memo line so the IRS knows which quarter the payment covers. Mail it early enough that it arrives by the important date — the postmark date is what counts, not the arrival date, but delays happen.

Mailing takes longer than paying online, so this method is best if you're paying well before the important date. If the important date is a few days away, pay online instead.

How much to pay each quarter

The standard approach is to divide your expected annual tax liability by four and pay that amount each quarter. If you expect to owe $8,000 in federal income tax for the year, you'd pay $2,000 each quarter. To estimate your annual liability, look at last year's tax return and adjust for any changes in income or deductions you expect this year.

You don't have to pay the same amount every quarter. If your income is uneven — for example, if you earn more in the summer than in winter — you can pay more in the quarters when you earn more and less in the quarters when you earn less. This keeps you from overpaying early in the year and then waiting for a refund.

If you underpay, you'll owe the difference when you file your return, plus a small penalty. If you overpay, you'll get a refund or can carry the overpayment to next year's estimated taxes. Most people aim to pay enough that they don't owe much at tax time, even if it means slightly overpaying.

What happens if you miss a important date

Missing a quarterly payment important date does not prevent you from filing your tax return on time. You can still file on April 15 of the following year even if you didn't pay any quarterly payments. However, you will owe a penalty on the unpaid amount.

The penalty is calculated based on the IRS underpayment rate, which changes quarterly. For 2024, the rate is 8% per year, which works out to roughly 2% per quarter. On a $2,000 quarterly payment you missed, the penalty would be around $40. The penalty is small, but it adds up if you miss multiple quarters.

If you realize you've missed a important date, you can still send the payment. The IRS will explore it to your account and calculate the penalty based on how late it was. There's no penalty for paying late if you pay before you file your return, as long as you include the penalty amount when you file.

Keeping records of your quarterly payments

Save the confirmation number or receipt from each payment you make. If you pay online through Direct Pay, you'll get a confirmation number when ready. If you pay by mail, keep a copy of the check or money order and the envelope you mailed it in. If you pay through EFTPS, print or save the confirmation page.

When you file your annual tax return, you'll report the total of all four quarterly payments on your return. The IRS will have a record of the payments you made online, but having your own records protects you if there's ever a discrepancy. It also helps you track whether you've paid enough to avoid a large bill at tax time.

If you use accounting software or work with a tax preparer, give them copies of your payment confirmations so they can include them in your return.

Frequently Asked Questions

Do I have to make quarterly payments if I'm self-employed?

Only if you expect to owe $1,000 or more in federal taxes for the year. If your self-employment income is small or you have large deductions, you might owe less than $1,000 and wouldn't be required to pay quarterly. Calculate your expected tax liability to be sure.

Can I change the amount I pay each quarter?

Yes. If your income changes during the year, you can adjust your quarterly payments. You don't need to notify the IRS — just send a different amount the next quarter. If you underpay, you'll owe the difference plus a small penalty when you file.

What if I overpay my quarterly taxes?

The overpayment will show up when you file your annual return. You can choose to receive a refund, or you can carry the overpayment forward to next year's estimated taxes. Most people choose the refund.

Can I make a quarterly payment after the important date?

Yes, but you'll owe a penalty on the late amount. The penalty is small — usually a few dollars per quarter — but it's avoidable if you pay on time. If you realize you're going to miss a important date, pay as soon as you can.

Do I need to make quarterly payments if I have a day job and side income?

Only if your total expected tax liability for the year exceeds $1,000 after accounting for the taxes withheld from your day job. If your employer withholds enough to cover your total tax bill, you don't need to pay quarterly. Check your pay stub to see how much is being withheld.