When will I receive my quarterly tax estimates?
If your onboarding is complete by the date listed below, you can expect to receive your estimate in the month before the IRS due date.
If your onboarding is not complete by the date listed below, please click here to learn about the manual process
If you are unsure of your onboarding status, please email [email protected]
If Your Onboarding Is Complete By
Your Estimate Is Provided During
For IRS Due Date
Using QBO Activity Taken into Account
January 1 - February 28
January 1 - April 30
January 1 - July 31
January 1 - November 30
Quarterly taxes 101
When you’re an employee, taxes are withheld from your paycheck, and these withholdings are applied to your final tax bill. As an S Corp, taxes are withheld from your paycheck for your salary, but these taxes don’t fully account for your S Corp’s pass-through profits. That’s where your quarterly taxes come in.
Every quarter, the government requires that you pay estimated taxes on those pass-through profits. Estimated taxes are due: April 15th, June 15th, September 15th (not for CA residence), and January 15th. If those dates fall on a weekend or holiday, the deadline moves to the next business day.
How we calculate quarterly tax estimates
As a Collective member, you don’t have to worry about the hardest part of quarterly taxes- doing the math! We take care of that for you. If you’re curious about how we crunch the numbers, here’s how we do it.
First, we pull information from your QuickBooks and Gusto accounts and review your financial activity from January 1st through last full month. Then we annualize your activity, which is a fancy way of saying that we use your year-to-date information to project your annual income by determining the average net income per month then multiplying by twelve.
By annualizing your income, we can project your marginal tax rate to help us determine your anticipated total tax liability for the year based on your S Corp activity.
Next, we divide the total tax liability by four for both Federal and State (with the exception of CA), if applicable. For example, if we think you’ll owe $16,000:
$16,000/4 = $4,000
We also take into account any prior estimated payments we advised and any income taxes that were withheld via payroll. If you made $4,000 in estimated taxes and are projected to have $2,000 withheld, we would do this:
$16,000 - $4,000 - $2,000 = $10,000
Then, we divide what’s left of your projected annual tax bill by the number of estimated tax periods left. In this example, there are two payment periods left.
$10,000 / 2 = $5,000
Because these are estimates, we round the results to the nearest $500.
How to receive the most accurate quarterly tax estimates
Because your quarterly tax estimates rely on your revenue and expenses, it’s important that your bookkeeping is up to date. If you’re a few months behind on your bookkeeping, now is a good time to catch up.
Here are some other tips for accurate quarterly tax estimates:
Connect QuickBooks Online and your business bank accounts
Don’t co-mingle personal and business transactions
Make sure to record all business expenses
If you missed any expenses, enter them manually in the books