If you made money this year without an employer withholding taxes for you, the IRS is expecting a payment soon — and missing it can get expensive fast.
The next estimated tax deadline lands on September 15.
It applies to anyone who earns income that isn't subject to automatic withholding: freelancers, gig drivers, rideshare workers, independent contractors, small business owners, and plenty of retirees and investors too.
The U.S. tax system runs on a pay-as-you-go model.
If you owe more than $1,000 when you file next spring, the IRS can tack on an underpayment penalty — essentially interest on money you should have paid earlier.
That penalty has been running around 7% to 8% annually in recent years, which is a lot higher than the near-zero rates of the 2010s.
You generally should make estimated payments if you expect to owe at least $1,000 for the year and your withholding covers less than 90% of this year's tax bill — or less than 100% of last year's, whichever is smaller.
Higher earners need to hit 110% of last year's figure.
A common shortcut is to simply match last year's total tax through a mix of withholding and estimated payments.
That "safe harbor" rule can shield you from penalties even if you end up owing more when you file, as long as you pay the rest by the April deadline.
The mechanics are simpler than they sound.
You can pay online through IRS Direct Pay, use your IRS online account, or schedule a payment through a tax software provider.
Payments can be scheduled in advance, so you don't have to remember the date.
One thing worth knowing: the deadline is not a hard wall for everyone.
If you file your return by January 31 and pay any balance due at that time, you can sometimes sidestep the penalty for that final quarter.
But experts say that path gets messy, and most people are better off just paying on time.
More side hustles are being reported to the IRS than ever.
Payment apps and online marketplaces now issue 1099 forms for gig work, reselling, and even some casual income.
If a paper trail exists, underpaying is much easier for the agency to spot — and much harder to explain away.
If money is tight, you don't have to solve this alone.
The IRS offers installment plans, and a tax pro can help you recalculate what you truly owe.
Underpaying on purpose is a gamble that rarely pays off. **Our take:** The September 15 date quietly catches thousands of first-time freelancers and side hustlers every year, and the penalty rate makes it sting more than it used to.
Final Thoughts
Set a calendar reminder, run a quick estimate, and pay what you can — even a partial payment beats skipping it entirely.