Controller & CFO services for South Florida's growing businesses.

Call or Text: (561) 699-2182

How do I calculate estimated quarterly taxes?

Estimated quarterly taxes exist because the IRS expects payment throughout the year, not just at filing time. If you’re self-employed, own a pass-through business, or have income that isn’t subject to withholding, you’re responsible for making these payments yourself.

The basic calculation starts with your expected annual tax liability. Take your projected income for the year, subtract deductions, apply the appropriate tax rates, and add self-employment tax if applicable. Divide that total by four to get your quarterly payment amount.

Most business owners use the safe harbor rule to avoid underpayment penalties. You have two options. Pay at least 100% of your prior year’s total tax liability divided into four payments. Or pay at least 90% of your current year’s tax liability as you go. If your adjusted gross income exceeded $150,000 last year, the safe harbor increases to 110% of prior year tax. Meet either threshold and you won’t face penalties even if you owe at filing time.

The challenge is that business income fluctuates. You might have a strong first quarter and a slow third quarter. The IRS allows you to use the annualized income method to match payments more closely to when you actually earned the money, but the paperwork is more complex. Most business owners find it easier to base estimates on last year’s tax and adjust if the current year looks significantly different.

Due dates fall on April 15, June 15, September 15, and January 15 of the following year. These dates apply to the calendar quarters of income, not the payment being exactly three months apart.

For pass-through entities like S-corps and partnerships, the business itself doesn’t pay estimated taxes. The owners do, based on their share of the expected income flowing through to their personal returns. C-corps are different and make estimated payments at the corporate level using Form 1120-W calculations.

Accurate estimates require accurate financial records. If you don’t know your year-to-date profit, you’re guessing at your tax liability. Controller-level oversight that includes monthly closes gives you the financial clarity to project income and adjust estimates before year end surprises hit.

If you’ve underpaid through the year, you can make a larger fourth quarter payment to catch up. The penalty for underpayment isn’t severe compared to other IRS penalties, but it’s avoidable with proper planning. Controller services in Boca Raton can help you stay ahead of these obligations rather than scrambling at year end.

State estimated taxes follow similar rules but with different rates and sometimes different due dates. Florida has no state income tax, which simplifies things for South Florida business owners, but if you have income from other states you may still have state estimated tax obligations there.

Premium Controller & CFO Advisory Firm

Next Step:
Let's Talk About Your Business

Tell us about your business and your goals. We'll discuss how Jargo can support your financial operations and growth.

More Questions

What are the accounting requirements for property managers?

Property managers must maintain separate trust accounts for tenant funds and produce accurate owner statements. Florida requires escrow accounts for security deposits and rent collected on behalf of owners, with strict prohibitions against commingling.

Read answer

How do I correct miscategorized transactions?

The correction method depends on when you catch the error. Same-period mistakes are simple reclassifications. Closed-period errors require adjusting entries that don't distort your current financials.

Read answer

What size business needs a fractional CFO?

Most businesses benefit from fractional CFO support between $2M and $20M in annual revenue. But size alone isn't the deciding factor. Complexity, growth rate, and the financial decisions you're facing matter more than raw numbers.

Read answer

How does a controller handle depreciation and amortization?

A controller maintains depreciation and amortization schedules, books monthly adjusting entries, reviews useful life assumptions, and ensures assets are properly recorded on financial statements. This work requires judgment that goes beyond basic bookkeeping.

Read answer

What causes messy bookkeeping in small businesses?

Messy books usually come from putting off reconciliations, mixing personal and business transactions, and having no clear process for recording income and expenses. Small gaps compound quickly when no one is actively maintaining the books.

Read answer

What tax credits are available for small businesses?

Small businesses can claim credits for research activities, hiring from targeted groups, providing health insurance, making facilities accessible, and starting retirement plans. Unlike deductions, credits reduce your tax bill dollar for dollar.

Read answer

Premium controller and CFO advisory services for South Florida businesses, located in Boca Raton. Jargo delivers executive-level financial leadership to companies that have outgrown basic bookkeeping. Owned and operated by a CPA with over 15 years of C-suite experience.

Client Reviews

5-Star Rated Firm

Social

  • Boca Chamber - Serving South Palm Beach County
  • BBB A+ Rating

© 2026 Jargo, LLC