When nobody withholds tax from your income, the IRS expects you to pay as you go. Miss the quarterly deadlines and you pay an underpayment penalty on top of the tax.
A system that works
- Move 25–30% of every payment into a separate tax savings account.
- Pay on April 15, June 15, September 15 and January 15.
- Use the safe-harbor rule: pay 100% of last year’s tax (110% for higher incomes) to avoid penalties.
- Recalculate mid-year if income jumps.
Set calendar reminders a week before each date — or let us send them to you.
