April 15 gets all the attention, but savvy Texas business owners know that the June 15 quarterly estimated tax deadline is equally important and often more dangerous for those who miss it. For self-employed individuals, freelancers, and business owners throughout Houston, Dallas, and San Antonio, missing this Q2 payment can result in an underpayment penalty that persists even after you pay your full balance in April.
This guide covers everything you need to know about the 2026 IRS quarterly estimated tax system, how to calculate your correct payment, and strategies to manage your cash flow so you are never caught off guard.
You are generally required to make quarterly estimated tax payments if you expect to owe at least $1,000 in federal taxes for the year after subtracting withholding and refundable credits. This applies to self-employed individuals, small business owners, partners in partnerships, S corporation shareholders, and anyone with significant investment income.
The IRS provides a detailed overview on estimated taxes to help you determine if you are required to pay.
Note that the Q2 deadline covers only two months of income (April and May), not three. This compressed window means many business owners underestimate their Q2 obligation and end up underpaying.
The safest and simplest approach is the safe harbor rule: pay at least 100% of the prior year’s tax liability (or 110% if your AGI was above $150,000 last year), divided equally across four payments. This guarantees you will not face an underpayment penalty regardless of how much your income changes.
If your income fluctuates significantly during the year, the annualized income installment method allows you to base each quarterly payment on your actual year-to-date income. This can reduce required payments in slow quarters but requires more detailed tracking.
You can also base each payment on 90% of the current year’s expected total tax liability. This works well if you have a reliable income projection, but carries more risk if your income ends up higher than expected.
You can pay your quarterly estimated taxes online through the IRS’s Electronic Federal Tax Payment System (EFTPS), by credit or debit card through approved IRS payment processors, or by mailing a check with IRS Form 1040-ES. EFTPS is free, secure, and allows you to schedule payments in advance.
If you underpay your quarterly estimates, the IRS charges an underpayment penalty based on the federal short-term interest rate plus 3 percentage points. For 2026, this rate is approximately 8% per annum, calculated on the underpaid amount for each day it remains unpaid.
The penalty can be surprisingly large if you have a significant income and miss multiple quarters. The only reliable way to avoid it is to stay on top of quarterly deadlines and make accurate payments.
At FAS Accounting Services, we take a proactive approach to quarterly tax management. We calculate your estimated payments at the beginning of each year, update projections quarterly based on your actual income and expenses, and remind you of every deadline with exact payment amounts so you are never guessing.
June 15, 2026 is the due date for the second quarter (Q2) estimated tax payment for the 2026 tax year. It covers income earned from April 1 through May 31, 2026. Self-employed individuals and business owners with no withholding are generally required to make this payment.
The simplest method is the safe harbor rule: pay 25% of your prior year’s total federal tax liability each quarter. If your AGI was over $150,000 last year, use 110% of prior year tax. You can also base payments on 90% of your current year’s expected tax liability.
Missing a quarterly payment triggers the IRS underpayment penalty, which is calculated at the federal short-term interest rate plus 3%. The penalty accrues from the missed due date through the date the payment is made, even if you pay your full annual tax bill in April.
No. Texas has no state income tax, so there are no state quarterly estimated tax payments for Texas residents. However, you are still required to make federal quarterly estimated tax payments to the IRS.
Yes. You can pay quarterly estimated taxes through the IRS EFTPS (Electronic Federal Tax Payment System) at eftps.gov, or by debit/credit card through IRS-approved payment processors. EFTPS is free and allows you to schedule payments in advance.
