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Guide · US · Updated May 18, 2026

How to pay quarterly self-employment tax

If you make money outside a W-2 paycheck, the IRS expects you to send it tax payments four times a year instead of all at once in April. Here’s who has to pay, when, how much, and the fastest way to actually do it.

Why quarterly payments exist

Income tax in the US is technically a pay-as-you-go system. When you’re a W-2 employee, your employer withholds tax from each paycheck on your behalf. When you’re self-employed, that withholding doesn’t happen — so the IRS asks you to self-withhold by sending estimated payments every quarter.

Who has to pay

The rule of thumb: if you expect to owe at least $1,000 in federal tax for the year after subtracting any W-2 withholding, you need to pay quarterly. For most freelancers earning more than a few thousand on the side, this is yes.

You can skip quarterly payments and avoid the underpayment penalty if your total withholding (from a W-2 or another source) covers either:

  • 100% of last year’s total tax (110% if your AGI was over $150,000), or
  • 90% of this year’s total tax.

This is called the “safe harbor” rule. Hit it and the IRS doesn’t care that you owe more at filing time.

2026 due dates

  • Q1: April 15, 2026 (for income earned Jan–Mar)
  • Q2: June 15, 2026 (for income earned Apr–May)
  • Q3: September 15, 2026 (for income earned Jun–Aug)
  • Q4: January 15, 2027 (for income earned Sep–Dec)

Yes, “quarters” aren’t actually equal in length. Q2 covers two months, Q4 covers four. Don’t ask.

How to calculate what to pay

Quarterly payments cover both income tax and self-employment tax. The simplest approach for most side hustlers:

  1. Estimate your net self-employment earnings for the year (revenue minus business expenses).
  2. Calculate SE tax — use our self-employment tax calculator.
  3. Add an estimate of federal income tax on the same earnings, based on your bracket. Many freelancers use a flat 20-25% as a rough estimate when starting out.
  4. Add the two together, then divide by 4. That’s your quarterly payment.

For more precision, IRS Form 1040-ES walks through it line by line. If you also have W-2 income, subtract whatever’s already being withheld before dividing.

How to actually send the money

You have three options, fastest first:

  • IRS Direct Pay (directpay.irs.gov) — free, no signup needed, takes about 3 minutes. Pulls from your bank. Best for individuals.
  • EFTPS (eftps.gov) — the official business payment system. Requires enrollment by mail and can take a week to set up. Worth it if you pay a lot of different types of federal tax.
  • Mail a check with Form 1040-ES vouchers — slowest and easiest to mess up. Skip if you can.

What happens if you miss a payment

The IRS charges an underpayment penalty calculated as interest on the unpaid amount. The rate floats with the federal short-term rate plus 3% — recently around 8% annualized. The penalty is per quarter, so missing Q2 and catching up in Q3 only costs you for the gap between deadlines, not the whole year.

If you forgot Q1, send it now. The penalty for two missed months is small. Don’t wait until next April to catch up — the penalty compounds.

State taxes

Most states also expect quarterly estimated payments if you owe state income tax. Deadlines usually mirror the federal ones. Check your state’s revenue department site — California, New York, and others have their own forms and online portals.

This is a general guide, not personalized tax advice. If your situation is unusual (multiple income sources, large income swings, first year self-employed), a CPA can save you more than they cost.

Frequently asked questions

Do I have to pay quarterly if my side gig is small?
Only if you expect to owe at least $1,000 in tax for the year after subtracting withholding from a W-2 job. If your side income is small enough that your W-2 withholding covers everything, you don't have to file quarterly estimates.
What happens if I miss a quarterly payment?
The IRS charges an underpayment penalty calculated as interest on the unpaid amount. The current rate floats around 8% annualized. You can catch up later in the year, but you can't fully eliminate the penalty for a missed quarter — paying the full balance at filing time still leaves you owing for the months you were behind.
Can I just pay everything in January or April?
Technically no — the IRS expects payments throughout the year. But if you owed less than $1,000 last year, or your total withholding covers 100% of last year's tax (110% if your AGI was over $150,000), you can avoid the underpayment penalty even without quarterly payments. This is the 'safe harbor' rule.
What's the easiest way to actually pay?
IRS Direct Pay (directpay.irs.gov) is free, takes about 3 minutes, and pulls from your bank account. EFTPS is the official system for businesses but is clunkier. You can also mail a check with Form 1040-ES vouchers, but online is faster and less error-prone.