What Are Estimated Tax Payments (and How Do You Pay Them)?

Ask any solopreneur what intimidated them most about self-employment (or has kept them from pursuing self-employment altogether) and the vast majority will say this: taxes.

Cringe. Groan. Eye roll.

When you work for yourself, your taxes aren’t automatically withheld from your paycheck the way they are when you’re a traditional employee. That means you’re responsible for paying them yourself by sending in your estimated tax payments correctly and on time.

Sound daunting? The good news is that managing your taxes as a freelancer or solopreneur doesn't need to be a major hurdle or a headache. This simple guide covers what you need to know.

What Exactly Are Estimated Tax Payments?

Self-employment income isn’t subject to automatic tax withholding. So, your estimated tax payments (which you might also hear referred to as “quarterly taxes”) are regular payments you make to the IRS and your state to pay taxes on your income throughout the year.

You’ll send in a tax payment four times each year—or, as the name implies, once each quarter.

So, what are these taxes for? These payments cover two key taxes:

• Self-employment tax: This covers your contributions to Social Security and Medicare. These are often referred to as “FICA taxes” because they’re collected under the Federal Insurance Contributions Act. When you’re a traditional employee, you pay 50% of your FICA taxes while your employer pays the other half. But, when you run your own business, you pay 100% of these taxes yourself.
• Income tax: Everybody with income pays income tax. Again, this is automatically withheld from your paycheck when you’re traditionally employed. But, you’ll need to pay it yourself as a solopreneur.

Rather than paying a lump sum for these taxes all at once, they’re spread throughout the year. Each quarter, you’ll look at your taxable income (this is your revenue minus your expenses and deductions) for that period and pay a percentage of it to the IRS and your state agency using the following forms:

• Form 1040-ES: For federal estimated taxes
• State form: For your state estimated taxes. The name of this form differs by state. You can search for “[State] estimated tax” to find the exact form you need.

Remember to keep a record of your estimated tax payments, including the date you paid and the amount. You’ll need that information during tax season to figure out if you overpaid (and will get a refund) or underpaid (and owe more money).

Key Dates for Estimated Tax Payments in 2025

It makes sense that your quarterly payments are due every quarter, but let’s get a little more specific about when you need to submit these payments. The quarterly tax payment deadlines for this year are:

• April 15, 2025
• June 16, 2025
• September 15, 2025
• January 15, 2026 (for the fourth quarter of 2025)

In general, the payment due date is on the 15th of every April, June, September, and January. However, if the 15th falls on a weekend or holiday, the deadline is pushed to the next business day. 

How to Calculate Your Estimated Tax Payments

Now you know what you’re paying and when you need to pay it—but how much do you need to pay? Since you’re paying a percentage of your income, the answer will be different for everyone.

The general recommendation for freelancers and other self-employed individuals is to set aside approximately 30% of your income for taxes. You’d pay 25% for federal income tax and 5% for state income tax.

Let’s say you’re a sole proprietor or an LLC. You generated $40,000 in revenue during the first quarter and had $10,000 in business expenses. That means your taxable income for the quarter is $30,000, so you’d set aside:

• $7,500 for federal income taxes
• $1,500 for state income taxes

Seem like an eye-popping number? It can be—which is why it’s crucial to prioritize setting aside money for these estimated tax payments (or have Lettuce do it for you automatically). Otherwise, you can be hit with a nasty surprise.

Keep in mind those percentages aren’t a hard and fast rule, and your tax obligation can differ depending on several factors. If you want to get more specific, a tax obligation calculator can help you determine exactly how much you owe. Here are a few recommended calculators:

• Lettuce Tax Estimator
• IRS Tax Withholding Estimator
• Tax Calculators (DOD Office of Financial Readiness)
• National Association for the Self-Employed 1040 Tax Calculator
• Tax-Rates.org Income Tax Calculator

You’ll input specific digits from your business and get a far more personalized recommendation for how much to pay in quarterly taxes.

Want to skip the math and guesswork? Lettuce can put your quarterly estimated taxes on autopilot by proactively setting aside money and making your payments for you all year long.

3 Tips to Pay Your Quarterly Taxes On Time and Target

Knowing the above basics will make estimated tax payments way less daunting, but here are a few more tips to keep in mind to help you pay the right amount on time every quarter.

1. Carefully Track Your Revenue and Expenses

Your quarterly taxes are a percentage of your income—and that means you need to know your income. It sounds simple enough. But, if you aren’t carefully tracking your revenue and expenses throughout the quarter, figuring out what you’ve earned and what you owe will be far more time-consuming and stressful.

Commit to categorizing your expenses and logging your invoice payments as they happen throughout the quarter (or opt to have Lettuce do it all for you). When it’s time to make your payment, you’ll have the added peace of mind that you’re working with accurate, up-to-date numbers.

2. Get Started Early

The quarterly estimated tax due dates are when your taxes are due—not when you should start thinking about them. If you’re mailing your tax checks, they need to be postmarked by the due date.

So, don’t wait until the deadline to start calculating and preparing your estimated tax payments. Get everything sorted out at least a few days ahead of the due date so that you can avoid added stress and late penalties.

3. Use Tools to Simplify the Process

Even with all of the information and calculators, managing your estimated tax payments can still be challenging—especially with irregular income and complex deductions that come along with being a business-of-one.

The good news is that you don’t need to go it alone. Lettuce can take the pain out of the quarterly tax process with:

• Automated reminders: Never miss a tax deadline or extension filing with friendly nudges that keep you ahead of schedule.
• Organized documents: Lettuce automatically collects, tracks, and stores your financial data so it’s ready when you need it.
• Streamlined quarterly tax payments: Lettuce can proactively set aside money and make your estimated tax payments for you—no math or stress required.

And that’s just a sampling of what Lettuce can do for your solo business. From answering your tax-related questions to preparing your annual filings, think of Lettuce as having your own, always-on accountant.

Take the Questions Out of Quarterly Taxes

Love them or hate them (we know, you probably hate them), taxes are an important part of being self-employed. But their constant presence doesn’t mean they need to be a constant pain.

With some thoughtful preparation and the right tools, you can transform your estimated tax payments from an overwhelming puzzle to a straightforward routine.

Ready to take the stress out of quarterly tax payments? Put them on autopilot with Lettuce.