Hey there, fellow freelancer! Have you found yourself scratching your head when it comes to quarterly taxes? Perhaps you’ve recently become self-employed or you have been in the game for a while and feel like you still don’t have a handle on it. Fear not! This guide is here to help you navigate quarterly taxes like a pro.

What are Quarterly Taxes?

Before we dive into the details, let’s define what we mean by “quarterly taxes.” As freelance or self-employed individuals, we are responsible for calculating and paying our federal income tax, as well as a self-employment tax. These taxes are typically paid in quarterly installments throughout the year, rather than one lump sum at tax time.

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When are Quarterly Taxes Due?

Knowing when your quarterly taxes are due is crucial to avoid late fees and penalties. The due dates for each installment are typically:

  • April 15th
  • June 15th
  • September 15th
  • January 15th (of the following year)

It’s important to note that if you mail in your payment, it must be postmarked by the due date, not received by that date. If you’re ever unsure of the due date, the IRS website has a handy “Estimated Taxes” tool that can help you calculate and determine your due dates.

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How to Calculate Quarterly Taxes

Calculating your quarterly taxes may seem daunting, but it can be broken down into a few simple steps.

  1. Estimate your total yearly income
  2. Determine your deductions and credits
  3. Calculate your self-employment tax
  4. Calculate your federal income tax
  5. Divide your total tax liability by 4

It’s important to keep track of your income and expenses throughout the year to ensure that your estimates and calculations are accurate. For more detailed instructions and help with calculating your quarterly taxes, check out the IRS’s “Form 1040-ES” and their instructions.

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How to Pay Quarterly Taxes

Now that you’ve calculated how much you owe, it’s time to pay up. There are a few different payment options available to you:

  • Online payment through the IRS website
  • Mail in a check or money order
  • Pay by phone

Whichever option you choose, make sure you keep a record of your payment and confirmation number for your records.

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Common Mistakes to Avoid

As with anything tax-related, there are a few common mistakes that freelancers and self-employed individuals can make when it comes to quarterly taxes.

  • Not keeping accurate records of income and expenses
  • Not accounting for changes in income throughout the year
  • Not paying enough or overpaying

Avoiding these mistakes can help make the quarterly tax process smoother and less stressful.

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In Conclusion

Navigating quarterly taxes as a freelancer or self-employed individual doesn’t have to be scary or stressful. With a bit of organization and planning, you can stay on top of your taxes throughout the year. And remember, if you ever need help or have questions, the IRS website and customer service is always available to assist you.

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