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Being a freelancer takes hard work, but more and more people are discovering how rewarding it can be to work for yourself. Why the surge in freelancing? There are a host of obvious advantages, ranging from a flexible schedule and remote work options to the ability to take on only the clients and projects you find the most interesting.
Of course, there are a few downsides, too, and the big one is that no one is providing you with benefits like health insurance and retirement plans. We’ll go over how to put together your own freelance benefits package in another article, but for now we want to focus on another issue: taxes. As a freelancer, you’ll have to pay a larger share of taxes because you don’t have an employer chipping in on your behalf. In most cases, you’ll also have to make sure and pay those taxes throughout the year — these are called estimated tax payments, and they can be unexpected (and expensive) if you aren’t planning for them.
What are Estimated Tax Payments?
Because states and the federal government don’t want to wait until the April after each tax year to get what they’re owed in taxes, they require individuals whose taxes will exceed a certain threshold to estimate how much they’ll owe at the end of the year and make payments in installments ahead of time.
Generally (though there are plenty of exceptions), that threshold is $1,000 each for individual states and the federal government, and payments are typically due in April, June, September, and the January following the tax year. We’ll get into the guidelines outlined by individual states, but let’s start by looking at the most broadly applicable federal regulations imposed by the Internal Revenue Service (IRS).
Federal Estimated Tax Payments
Your federal estimated tax payments are due on April 15th, June 15th, September 15th, and the following January 18th. Form 1040-ES includes an Estimated Tax Worksheet to help you anticipate how much you’ll owe, but it’s safe to assume you’ll need to make estimated payments if you expect to make more than $10,000 in freelance work in a given year. If freelancing is just a side gig and you have other income pushing you into a higher tax bracket, the amount above which you’ll need to make estimated payments might drop to $5,000 or even lower. Look at the 2021 Tax Rate Schedules included in Form 1040-ES to ensure you’re prepared to pay what you owe on time.
Tax rates are progressive, meaning your first $9,950 in income is always taxed at 10% — whether that’s your entire year’s earnings or you’re Elon Musk and it’s a drop in the bucket. Confused? Let’s walk through an example for an unmarried freelancer making $48,000 in 2021. That first $9,950 is taxed at the 10% bracket, amounting to $995. For earnings over that $9,950 threshold and up to the $40,525 threshold (which equals $30,575), our freelancer will pay a slight tax increase to 12%. That amounts to a $3,669 tax obligation plus the original $995 tax for a total of $4,664. For income above the $40,525 mark, our freelancer will face a substantial tax increase to 22%, however, that higher tax is only imposed on the amount above the $40,525 tax bracket threshold. Our freelancer made $7,475 in this higher 22% tax bracket, creating an additional burden of $1,644.50.
It’s incredibly important to understand how our progressive income tax works, because people often mistakenly assume that moving up into the next tax bracket (by making slightly more than $40,525, for example) will end up actually costing them a significant chunk of money. As a result, they feel like they should stop working and avoid paying more in taxes, when that scenario simply isn’t a reality. The highest earners in the country are still only paying 10% on their first $9,950 in income, 12% on the amount in the next bracket, and so on up to the 37% bracket on amounts over $523,600. In other words, taking on an additional gig that will put you in a higher tax bracket will never end up costing you money overall — so take it!
Once you have an idea of your income and how much you’ll owe the federal government in taxes, you’ll want to divide that amount into four chunks to determine how much you should pay in quarterly estimated taxes.
If you freelance but also work as an employee, you have an additional option. Instead of making estimated tax payments on your freelance income, you could opt to increase the amount withheld from each paycheck you receive from your employer. This strategy won’t change how much you end up paying — it’s just a way to minimize the time you have to spend on administrative tasks in your freelance business. If you’re not sure how much you should have withheld from your primary job, you can use the IRS’s Tax Withholding Estimator. The moral of the story is that the IRS doesn’t really care how you go about paying your taxes as long as you pay them on time. However, if you underpay or fail to pay, you can expect them to notice and tack on a fee plus interest.
Penalties
To avoid being penalized, you’ll want to try and pay at least 90% of your anticipated tax burden in a given year. There are exceptions to this rule, and the IRS will forgo the underpayment fee if you pay at least 100% of the amount you owed on your prior year’s taxes (or 110% of that amount if you make more than $75,000 in adjusted gross income (AGI) as a single filer or more than $150,000 in AGI filing jointly).
If you fail to meet one of these thresholds, the IRS will impose of fee of 3.398% of the amount you underpaid. In other words, if your total tax burden was $20,000 but you only paid $10,000, you’ll be charged an extra $339.80. In addition, the IRS will charge interest on unpaid balances each quarter at a rate of 10% per annum.
A 3.398% penalty probably won’t be the end of your freelancing business, but it can add up and eat into your profit margins if you let it. To avoid such an unnecessary expenditure, make a reasonable effort to calculate your tax burden and make the estimated payments on time. Go off of what you paid in taxes for the prior year if possible, or if it’s your first year with freelance income, base your estimated payments off your best guess of your income for the year. Paying something is almost always better than paying nothing. For example, even paying just 50% of your total tax burden also cuts the cost of the inevitable penalty by 50%, while saving you from having to pay an entire year’s worth of income taxes at once.
Ways to Pay
Once you’ve marked the due dates on your calendar and figured out how much you need to pay, the next step is to ensure the IRS gets the money on time. Fortunately, there are plenty of convenient ways to pay your taxes according to your own preferences. Direct Pay, for example, lets you pay the IRS directly from your bank account, and there is no registration required and no fees.
The Electronic Federal Tax Payment System (EFTPS) does require a registration, but the service also offers more features than Direct Pay. You can schedule payments up to a year in advance, track payments using email notifications, and even make free payments by phone through the EFTPS voice response system at 800-555-3453. If you plan to use EFTPS, don’t wait until the last minute — new registrations can take as many as five business days to process before you can begin making payments.
Prefer to send payments by mail with a check or money order? The graphic below shows where to mail your estimated tax payments based on where you live. Be sure to follow the instructions in Form 1040-ES and include a Payment Voucher with each payment, and remember that payments in cash will not be accepted.
Now that we’ve discussed how to make estimated quarterly payments for federal income taxes — one of the most important parts of filing taxes as a freelancer — let’s have a look at the process for state income tax.
State Estimated Tax Payments
Income tax will vary from state to state, and in fact, some states have no personal income tax at all. Different states will also have varied expectations when it comes to quarterly estimated payments. For some, you’ll only need to pay estimated taxes if you’re expecting to have a tax bill of more than $1,000. For others such as Missouri, that amount drops to $100, meaning virtually every freelancer in the state will need to plan on estimated payments.
No matter where you work, your income tax will be based on the state in which you live (also called your resident state). Scroll down to the state you call home for a quick primer on its specific rules and regulations regarding estimated tax payments.
Alabama estimated tax payments: In Alabama, you’re required to make estimated payments if you anticipate a tax liability in excess of $500 in 2021. Payments are due on April 15th, June 15th, September 15th, and January 15th, and it’s worth noting that estimated tax payments of $750 or more are required to be paid electronically. You can pay via Debit through the My Alabama Taxes portal, or you can get pre-approved by the Alabama Department of Revenue to pay via ACH Credit.
Alaska estimated tax payments: There’s no Alaska income tax, so you’re off the hook! Don’t forget to make your Federal estimated tax payments.
Arizona estimated tax payments: In Arizona, you’re required to make estimated tax payments if your gross income for both the prior year and current taxable year combined exceeds $75,000 for individuals or $150,000 for married taxpayers filing jointly. These payments should amount to at least 90% of your tax obligation for the current year or 100% of tax due in the prior year, and in most cases, they should be paid in four equal installments on April 15th, June 15th, September 15th, and January 15th of the next year. Payments can be online using the state’s payment portal or by mail using printed vouchers and a check or money order.
Arkansas estimated tax payments: If an Arkansas taxpayer’s anticipated tax burden is more than $1,000, they are required to file a Declaration of Estimated Tax (Voucher 1) with the Department of Finance and Administration before April 15th of the income year, and they’ll need to pay at least 90% of the estimated total tax obligation in quarterly installments. If they don’t pay at least 90%, the underpayment will be fined at 10% per annum. Based on the state’s tax brackets, the $1,000 tax burden translates to an income of roughly $30,000. If you’re at this income threshold or above it, you’ll want to set aside money for your estimated tax payments. You can pay online using ATAP Arkansas or by mailing a check or money order payable to the Department of Finance and Administration at:
Department of Finance and Administration
Income Tax Section
P.O. Box 9941
Little Rock, AR 72203-9941
California estimated tax payments: If you’ll owe at least $500 in taxes to the state of California, you’ll need to make estimated tax payments. That amount translates to an income of about $30,000 for a single filer. California’s estimated tax due dates are a little different than the federal dates. 30% of the total estimated tax burden is due by April 15th and another 40% is due by June 15th. Although no additional payment is necessary on September 15th, it’s encouraged to reduce the burden of the remaining 30%, which is due on January 18th. Estimated tax payments can be made for free by bank account online, or for a fee by using a credit card. You can also mail a check or money order to the California Franchise Tax Board at:
Franchise Tax Board
PO Box 942867
Sacramento CA 94267-0008
Colorado estimated tax payments: Form DR0104EP will tell you everything you need to know about making your Colorado estimated tax payments. Like many states, Colorado’s cutoff for estimated payments is a tax burden of $1,000 or more, but you’re only required to pay the smaller of 70% of your actual liability, 100% of your prior year net liability if there was less than $150,000 on the return, or 110% of the prior year. Paying by credit or debit card? Click the link to make Colorado estimated tax payments online via the state’s payment portal. You can also register in advance to make Electronic Funds Transfer (EFT) payments, or you can mail a check or money order to:
Colorado Department of Revenue
Denver, CO 80261-0008
Connecticut estimated tax payments: Form CT 1040-ES will help you calculate your estimated tax payments in the state of Connecticut, which you can pay online including by credit card. These payments are due on April 15th, June 15th, September 15th, and January 17th, and they’re required if you expect to owe the state at least $1,000 after withholdings and credits. You can forgo the last payment if you file your 2021 tax return by February 1st and pay the entire balance due at that time. Connecticut is relatively strict about late payments, charging 1% per month on underpayment. In other words, failing to make estimated payments throughout the year could lead to a 12% or more increase in your state tax burden, depending on when you finally catch up.
Delaware estimated tax payments: If you’re going to have a tax liability greater than $800, which roughly corresponds to at least $25,000 in adjusted gross income, the state of Delaware requires you to make estimated tax payments. Due dates are April 30th, June 15th, September 15th, and January 18th, and the penalty for late payments or underpayments accrues at a rate of ½% per month. If you plan to make estimated tax payments via credit card, note that the maximum allowable payment amount is $10,000. There are no such limits placed on bank payments from a checking or savings account or check payments.
Florida estimated tax payments: There’s no personal income tax in Florida, which means freelancers or any business owners operating S corps, limited liability companies (LLCs), partnerships, or sole proprietorships are all exempt from the requirement to pay estimated income taxes.
Georgia estimated tax payments: According to the Georgia Department of Revenue, estimated tax payments are due on April 15th, June 15th, September 15th, and January 15th. The state also gives you the option to pay your entire tax liability in the first payment, in which case you’re relieved of the need to make the three remaining payments later in the year. You can pay electronically using the Department of Revenue’s Georgia Tax Center (GTC) tool, or you have the option to pay by mail or even in person (appointment required). Failure to pay will result in a 9% per year penalty.
Hawaii estimated tax payments: The Hawaii Department of Taxation requires you to make quarterly estimated tax payments if you’re anticipating a tax burden of more than $500. Due dates fall on April 20th, June 21st, September 20th, and January 20th. Residents can make payments online via domestic bank accounts, credit cards, and debit cards, or they can mail payments via check or money order along with the income tax payment vouchers found at the bottom of Form N-200V.
Idaho estimated tax payments: Idaho is an exception in that it doesn’t require individuals to make estimated tax payments, although the state will accept payments toward a future tax debt any time before the due date. Payments can be made in person at one of the state’s six offices, online via credit cards, debit cards, and e-checks (which include a processing fee), or via ACH credit and ACH debit payments. For residents wishing to calculate their total estimated income tax burden, Idaho provides Form 51, which also includes a voucher for making payments.
Illinois estimated tax payments: In the state of Illinois, estimated tax payments are required if residents expect to owe more than $1,000 in income tax at the end of the year. For help calculating your income tax liability, you can use Form IL-1040-ES. Payments are due April 15th, June 15th, September 15th, and January 15th. If one of those due dates falls on a weekend or holiday, the payment will be due on the following business day. Payments can be made online via a checking or savings account at mytax.illinois.gov, or using a MasterCard, Discover, American Express, or Visa card. Note that credit card providers will charge a convenience fee. Residents who are 65 or older and live in a nursing home do not have to make payments.
Indiana estimated tax payments: Your Indiana estimated tax payment is broken up into four installments due in the middle of April, June, September, and the January following the end of the year in which you’re paying the tax. You’re required to make Indiana estimated tax payments if you expect to have a tax liability of $1,000 or more, which translates to an income of roughly $31,000 based on Indiana’s 3.23% state income tax rate.
Iowa estimated tax payments: The state of Iowa requires anyone expecting to owe more than $200 to make estimated tax payments, with quarterly due dates falling on April 30th, June 30th, September 30th, and January 31st. Freelancers and business owners can enroll with the state to receive a Business eFile Number (BEN) and pay their estimated quarterly taxes online. Payments can be made from savings or checking accounts, and there are no fees for making electronic payments.
Kansas estimated tax payments: In Kansas, the Department of Revenue requires estimated tax payments for an anticipated tax obligation of $500 or more. If you’re not sure how much you will owe, the Kansas Department of Revenue offers an Income Tax Calculator to help you determine your overall liability. Due dates fall on April 15th, June 15th, September 15th, and January 15th, or the next business day if those dates are weekends or holidays. Payments made by credit card will be charged a convenience fee by the state’s third-party payment processor.
Kentucky estimated tax payments: The Kentucky Department of Revenue requires taxpayers who anticipate owing more than $500 in income tax to make estimated payments throughout the year. These installments are due on April 15th, June 15th, September 15th, and January 15th. Late payments will be charged according to the interest rate outlined in KRS 131.183, which was 5% in 2021. For now, the Kentucky Department of Revenue accepts ACH payments through its online payment portal, in addition to debit cards and electronic checks. For freelancers with higher tax obligations, it’s important to note that debit payments carry a 1.5% transaction fee. Residents can also pay by check using the instructions outlined in Form 740-ES.
Louisiana estimated tax payments: Any individual expecting to owe more than $1,000, or $2,000 in the case of joint filers, must pay estimated taxes according to the Louisiana Department of Revenue. Payment vouchers are found on Form IT-540ES, and due dates fall on April 15th, June 15th, September 15th, and January 15th. Filing instructions Form IT-540ESi will help residents calculate their income tax obligation, and payments can be made online, via credit card (which requires a convenience fee), or over the phone.
Maine estimated tax payments: In Maine, an estimated individual income tax burden of $1,000 or more requires quarterly payments due on April 15th, June 15th, September 15th, and January 15th. Residents can remit payments toward their estimated income tax liability using Maine EZ Pay, the Maine Department of Revenue’s online payment portal, or via a check or money order. Those opting to make physical payments must include the proper voucher found in Form 1040ES-ME and mail the voucher and payment to:
Maine Revenue Services
P.O. Box 9101
Augusta, ME 04332-9101
Maryland estimated tax payments: Maryland requires estimated tax payments on income tax liabilities exceeding $500, and residents can turn to the state’s estimated tax calculator for help determining their overall tax burden. Payments can be made through the online portal, but it’s important to note that payments processed through Comptroller of Maryland payment portal will incur a relatively steep 2.49% service fee. Alternatively, residents can pay via mail by attaching a check or money order to Form PV and mailing it to:
Comptroller of Maryland
Payment Processing
PO Box 8888
Annapolis, MD 21401-8888
Massachusetts estimated tax payments: The Massachusetts Department of Revenue requires estimated payments for individuals anticipating a tax liability of $400 or more, and you’ll need to pay at least 80% of the taxes you owe over the course of the year to avoid penalty. If that’s not possible (or you’re too late), you can calculate your underpayment penalty using the state’s Estimated tax penalty calculator. To find out how much you should be paying, use the Massachusetts Department of Revenue’s Quarterly Estimated Tax Calculator. Payments are to be made in 25% installments due on April 15th, June 15th, September 15th, and January 15th, and they can be paid by mail or online using the MassTaxConnect portal.
Michigan estimated tax payments: In the state of Michigan estimated tax payments are required for residents expecting a total tax liability of more than $500. At the state’s flat 4.25% income tax rate, that means freelancers making about $12,000 will need to plan for quarterly estimated payments. Payments are due April 15th, June 15th, September 15th, and January 15th, and they can be paid by mail with a Michigan Estimated Tax Voucher from form MI-1040ES or online using the Michigan Department of Treasury’s e-Payments system.
Minnesota estimated tax payments: Minnesota estimated tax payments are required for an anticipated tax liability of $500 or more, with due dates falling on April 18th, June 15th, September 15th, and January 15th. The Minnesota Department of Revenue also allows residents to make one estimated payment for the entire year, but if you go that route, you’ll need to remit payment by April 18th. Form M1 will help you calculate your Minnesota tax liability, but you’ll need to first use federal Form 1040-ES to calculate your federal AGI. Once you know how much to pay, you can either use a credit or debit card (with convenience fee) by going to the state’s third-party payment portal, or you can mail a check or money order along with a payment voucher to the address listed on the voucher.
Mississippi estimated tax payments: The Mississippi Department of Revenue requires estimated payments from individuals expecting an annual tax liability of more than $200. According to the state’s existing rate schedule, that translates to an income of about $6,000 for single filers, although that amount will likely be higher once you take into account deductions and exemptions. Payments can be made for free online via the state’s Taxpayer Access Point (TAP), or you can mail a check or money order along with the voucher on Form 80-106 to:
P.O. Box 23075
Jackson, MS 39225-3075
If you’d rather pay with plastic, the Mississippi Department of Revenue accepts Visa, MasterCard, Discover, and American Express, however credit cards will incur 2.5% processing fee.
Missouri estimated tax payments: The Missouri Department of Revenue requires residents to file a declaration for estimated tax payments if they’re anticipating a burden of just $100. According to the state’s tax rate, that figure translates to an income of about $4,300, meaning almost every freelancer in the state with a profitable business will need to pay quarterly taxes. Due dates fall on April 15th, June 15th, September 15th, and January 15th, and payments can be made by electronic bank draft for a fee of just $0.50. On the other hand, debit or credit card payments of $100.01 or more will be charged 2.15%. Vouchers for mail-in payments are available on Form MO-1040ES. Mail your check or money order to:
Missouri Department of Revenue
P.O. Box 555
Jefferson City, MO 65105-0555
Montana estimated tax payments: The Montana Department of Revenue requires estimated tax payments if you expect to owe more than $500 at the end of the year. Due dates fall on April 15th, June 15th, September 15th, and January 15th, or the business day following these dates if they fall on weekends or Montana State Holidays. Pay using mail-in vouchers or the state’s online payment portal.
Nebraska estimated tax payments: Nebraska quarterly estimated tax payments are required for tax liabilities exceeding $500 after calculating withholdings and credits. The anticipated balance can be paid in the first payment, due April 15th, or in four equal installments. The three remaining due dates are June 15th, September 15th, and January 15th, and payments must be initiated before 5:00pm Central Time on the due date to avoid late fees and interest. Payments can be made using the Nebraska Department of Revenue’s e-pay system.
Nevada estimated tax payments: If you live in Nevada, you don’t have to pay a personal income tax.
New Hampshire estimated tax payments: The state of New Hampshire doesn’t tax earned wages, which means that many freelancers will be exempt from making estimated quarterly payments. On the other hand, the state does require taxpayers with an estimated tax liability of $500 from interest and dividends to make quarterly payments. If you have investments that put you in that category, use the vouchers on Form DP-10-ES or make payments online at www.revenue.nh.gov/gt. Payments are due on April 15th, June 15th, September 15th, and January 15th for calendar year filers.
New Jersey estimated tax payments: The state of New Jersey requires estimated tax payments for an anticipated liability of more than $400. These payments are due on April 15th, June 15th, September 15th, and January 16th of the following year, and they can be made using the state’s online payment portal or by mail according to the instructions on Form NJ-1040-ES.
New Mexico estimated tax payments: The New Mexico Department of Revenue requires estimated payments to be made for an anticipated tax burden of $500 or more. Like most estimated tax payments New Mexico sets deadlines of April 15th, June 15th, and September 15th of the tax year, with the final payment due on January 15th of the following year. To make free payments online, taxpayers will need to sign up for an account using the Department’s Taxpayer Access Point (TAP). Vouchers for mail-in payments can be found on Form PIT-ES, while PIT-ES INS details more in-depth instructions for estimated tax payments.
New York estimated tax payments: The New York state estimated tax payment process begins at an anticipated tax liability threshold of $300. Taxpayers can create an account to use the New York state Department of Taxation and Finance online payment portal, or they can pay by mail by filling out Form IT-2105, Estimated Tax Payment Voucher for Individuals. Payments are due on April 15th, June 15th, September 15th, and January 18th of the following year.
North Carolina estimated tax payments: In the state of North Carolina, estimated taxes are required for liabilities of $1,000 or more. Like many other states, calendar year filers must make payments by April 15th, June 15th, September 15th, and January 15th. Mail-in payments must include a copy of Form NC-40, which can be personalized to meet your specific tax situation. You can also get a form mailed to you by calling the NC Department of Revenue at 1-877-252-3052, or you can file Form NC-40 online.
North Dakota estimated tax payments: In North Dakota, estimated taxes are required to address an anticipated tax liability of $1,000 or more. Because the state also has some of the lowest income tax rates in the nation, that translates to an approximate income of $80,000 for single filers. Form ND-1ES has additional instructions for calculating your tax obligation, and due dates fall on April 15th, June 15th, September 15th, and January 15th. Checks and money orders payable to the “ND State Tax Commissioner” can be mail according to the instructions provided in the form, or taxpayers can use the ND Taxpayer Access Point online portal.
Ohio estimated tax payments: In the state of Ohio estimated tax payments are necessary if you expect to owe more than $500 in income taxes at the end of the year. Based on the state’s 2021 income tax rates, that translates to about $30,500 in income for single filers. Mail-in payments must be accompanied by the vouchers on Ohio IT 1040ES, but residents can also make payments electronically using the Department of Taxation’s online payment portal. Due dates fall on April 15th, June 15th, September 15th, and January 18th.
Oklahoma estimated tax payments: In the state of Oklahoma, residents must pay estimated taxes if they expect to owe a balance of $500 or more at the end of the tax year. Based on the state’s income tax rate, that translates to an income of about $21,000. Payments are due on April 15th, June 15th, September 15th, and January 15th of the following year, and they can be submitted via mail along with payment vouchers from Form OW-8-ES or paid online using the state’s payment portal.
Oregon estimated tax payments: The Oregon Department of Revenue requires you to make estimated payments if you anticipate a tax liability of $1,000 or more. Because the state has no sales tax, it makes up for that lack of revenue with one of the highest progressive income tax schedules in the nation. If you make slightly more than $17,000 as a single filer and that amount isn’t subject to withholdings, you’ll need to make estimated tax payments. For calendar filers, quarterly payments are due on April 15th, June 15th, September 15th, and January 18th. To pay via check or money order, you’ll need to include a completed voucher accessible using Form OR-40-V and make the amount payable to the Oregon Department of Revenue. Online payments can be made directly from your checking or savings account, or by using a credit or debit card which will incur a convenience fee.
Pennsylvania estimated tax payments: As outlined by the Pennsylvania Department of Revenue, residents need to make estimated payments if they expect more than $8,000 in taxable income that isn’t subject to employer withholdings. Because the state has a flat tax rate of 3.07%, you can simply multiply your anticipated income by this rate and then divide the result into four equal quarterly payments. Payments are due on April 15th, June 15th, September 15th, and January 15th, or the first business day following if these dates fall on a weekend or holiday. You can pay estimated taxes online via the myPATH payment portal, or you can elect to pay by phone by calling ACI Payments, Inc. at 1-800-2PAYTAX (1-800-272-9829) and using a credit or debit card. Be aware that this service comes with a 2.49% convenience fee. For a free way to pay by phone, call 717-425-2495 Ext PAYPA (72972) and have your account number and routing number available to allow the state to make an ACH withdrawal.
Rhode Island estimated tax payments: If you’re self-employed in Rhode Island estimated tax payments are required for an anticipated tax liability of $250 or more. An income of $20,000 will put single filers over that threshold thanks to a tax rate schedule that’s about average compared to other states. Payments are due on April 15th, June 15th, September 15th, and January 15th, and can be made using the state’s Tax Portal or by credit card (with a 2% + $1.00 fee) via RI Interactive. Residents can also pay by mailing Form RI-1040ES vouchers to:
RI Division of Taxation
One Capitol Hill
Providence, RI 02908
South Carolina estimated tax payments: In South Carolina, estimated income taxes are required for an anticipated tax obligation of just $100 or more. That threshold will be reached at about $19,000 for single filers. Payments are due on April 15th, June 15th, September 15th, and January 18th, and the state’s new MyDORWAY payment portal offers a variety of convenient options to pay. MyDORWAY is free to use, but residents that prefer to mail payments can still print out vouchers from Form SC1040ES and mail checks payable to SCDOR to:
SCDOR
IIT Voucher
PO Box 100123
Columbia, SC 29202
South Dakota estimated tax payments: South Dakota is one of the seven states with no personal income tax, meaning freelancers residing there just need to worry about their federal estimated tax payments.
Tennessee estimated tax payments: Tennessee doesn’t tax wages, and individual filers aren’t required by the Tennessee Department of Revenue to make estimated quarterly payments. On the other hand, businesses including LLCs, corporations, and partnerships with a combined franchise and excise tax burden of more than $5,000 will need to make quarterly payments. The current franchise tax rate is 0.25% of either a business’s net worth or the value of its real and tangible property in Tennessee — whichever is greater — and the state’s excise tax is 6.5% of taxable income. For businesses that meet the designated threshold, estimated payments are due on April 15th, June 15th, September 15th, and the following January 15th. The best way to make these payments is using the Tennessee Department of Revenue’s online payment portal.
Texas estimated tax payments: The Texas Constitution disallows personal income taxes, which means freelancers living here are liable only for federal estimated tax payments.
Utah estimated tax payments: Utah does have a state income tax, but the state doesn’t require residents to make quarterly payments. Instead, all income taxes must be paid by the April tax due date, which happens to be April 15th in 2022. That being said, those wanting to limit their overall financial burden at tax time can click the link to prepay at any point during the year.
Vermont estimated tax payments: The state of Vermont asks its residents to pay quarterly estimated taxes that are equal to 90% of their estimated tax liability for the year or 100% of the prior year’s liability. Due dates are April 15th, June 15th, September 15th, and January 15th. The state accepts payment by credit card, ACH debit, or check, but it’s worth noting that credit card payments carry an additional three percent service fee.
Virginia estimated tax payments: If your tax liability is expected to exceed $150, the state of Virginia expects quarterly tax payments. Direct bank payments are free, but credit or debit card payments carry a service fee. Virginia has a few additional stipulations about payment methods, and if any installment exceeds $2,500 or the total income tax due will exceed $10,000, all income tax payments must be submitted electronically. In all other cases, the state will also accept checks or money orders mailed to:
Virginia Department of Taxation
P.O. Box 1478
Richmond, VA 23218-1478
Washington estimated tax payments: There’s no Washington state income tax, so just make your Federal estimated tax payments on time and you’re in the clear.
West Virginia estimated tax payments: In West Virginia, estimated tax payments for a liability greater than $600 are due April 15th, June 15th, September 15th, and January 15th. If one of those days is a weekend or a legal holiday, the due date will be the following business day. If residents wait and pay one lump sum before the tax return is due in April of the following year, penalties will be imposed for each missed payment. If a taxpayer paid more than $50,000 in income tax in the prior tax year, they’re required to make subsequent payments using Electronic Funds Transfer (EFT) or a 3% penalty will be applied.
Wisconsin estimated tax payments: For anticipated tax liabilities greater than $500, the state of Wisconsin requires quarterly payments to be made on or before April 15th, June 15th, September 15th, and January 18th. Residents can pay online, or they can call the Department of Revenue to request vouchers by mail. Payment amounts should add up to at least 90% of your current year total tax liability or 100% of your prior year Wisconsin tax liability to avoid underpayment interest.
Wyoming estimated tax payments: Lucky you! There’s no Wyoming income tax for individuals, so you’ll just need to remember to make your Federal estimated tax payments throughout the year.
Conclusion
Estimated tax payments are an important part of the tax process for freelancers. Even if you happen to live in a state with no personal income tax, you’ll still need to make your quarterly estimated payments to the federal government to avoid additional fees and interest.