Your September Estimated Tax Payment: Tips On Making It Easier
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This week on the Sunlight Tax Podcast, I’m breaking down estimated quarterly taxes for self-employed people, freelancers, creatives, and small business owners. I’ll explain how bookkeeping helps you calculate your tax payments more accurately, avoid surprises, and stay on top of your federal and state tax obligations throughout the year.
I’m also introducing my new intensive program for self-employed business owners who want to get the tax, bookkeeping, and legal side of their business properly set up.
Also mentioned in today’s episode:
00:10 Introduction and importance of quarterly tax payments
02:23 Understanding quarterly tax payments for self-employed
05:05 How to estimate your tax liability based on profit to date
08:04 Simplifying bookkeeping and estimated tax payments
10:44 Working with a licensed tax professional versus AI
12:31 Details of the two-day program and what participants will learn
14:16 Program features: database, private consultations, and setup
16:04 Upcoming cohort dates and how to join the waitlist
17:25 Building trust and transparency in business setup
18:19 Reminder to pay estimated taxes and get bookkeeping in order
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Episode Links:
Watch my walkthrough video on how to pay your Estimated Quarterly Taxes
Join the 2-Day Business Setup Intensive Waitlist
Get your FREE visual guide to tax deductions
Order my book:Taxes for Humans: Simplify Your Taxes and Change the World When You’re Self-Employed
Transcript:
Hannah Cole (00:07)
Hello beautiful. I hope everything is good in your world. I am coming to you after a day of playing hooky. I had my anniversary yesterday, and my partner and I took the day off and went for a hike, and it was just absolutely delightful. And then we saw my friend speak about her work. she has a nonprofit called the Lotus Campaign, which is worth checking out.
it's really cool. She's using market-based sort of like urban planning principles and market-based solution to homelessness. and the model is proving to really work and become scalable. So that was really fun, and I'm feeling refreshed and ready to jump into tax world and a busy fall season. So
What I want to talk to you about today is just a little short and sweet, practical reminder. The quarterly tax deadline, the third one of the year, is coming up in just a couple weeks. September 15th is the third estimated quarterly tax deadline of the year. does that mean, right? If you are a small business owner, you are meant to be paying your taxes every quarter.
It's really important that you do this. For those of us who are not employees, when we're self-employed, it is actually the tax system requires that we make tax payments throughout the year on a quarterly basis. So it's a much more forgiving pace than employees have because employees are paying their taxes through withholding on their paychecks every two weeks, every single time that they get paid.
And of course, that's lovely because it's so much less painful because they never you never see it. It never goes into your bank account and then has to leave again. So it can feel so much more onerous when you work for yourself. And it's why I spend a lot of my time and focus on teaching people how to track, calculate, and manage their estimated quarterly taxes. It's a really hard learning curve and it's not your fault.
There is no tax education in this country, right? We are not taught how to do this. Or even that this law exists and applies to us, right? So a lot of people are really surprised when they start a new business. Like, wait, what do I have to do? I'm sorry, I was supposed to be paying my taxes all through the year. I thought I paid on April 15th. And then as a tax practitioner, you have to say, no, you actually have penalties due because you weren't paying throughout the year. So
I'm coming here as a PSA to you to remind you that September 15th is coming up. It is the third deadline of the tax year 2026. It is when you are meant to make your third estimated quarterly tax payment based on 2026 income. So this is real-time income. you're paying tax on your profit in your business.
And you owe not just income tax on that, but you also owe self-employment tax. Self-employment tax for those who need a refresher, and don't we all, is 15.3% of the profit from your business. Okay. And that goes to Medicare and Social Security, whereas income tax goes to all the other stuff. Okay. So you owe both layers of that on your profit from your business and you owe it each quarter.
Now, of course, one of the tricky parts is you don't have a crystal ball. You don't yet know exactly what your tax rate for the year is going to be because you don't know how much money you're gonna make for 2026 until 2026 is over, right? This is the hard part, and it's the part that's really hard to get your head around, right? Wait, I don't know my tax rate. How do I pay the right amount? We get a little too hung up on paying the right amount.
And missing the boat that it is an estimate. It's called an estimate because you can only estimate. You actually can't get closer than an estimate because you don't have a crystal ball. You don't know the future. You don't know yet what your profit for 2026 will be. You only know what your profit to date is in 2026. So that is a very good way to make the calculation based on your profit to date. And that is usually what I recommend.
Though not always. So this is your PSA, and technically the rules say by the third deadline of the year, you should have paid to date 75% of the total tax that you'll owe for 2026. Now, again, not to freak out too much, there's leeway in this system on purpose. It's called an estimate, and they mean that, because you don't know exactly what your tax will be. So you are taking 75% of X.
Right? 75% of a number you have an idea about, but you're not gonna get precisely to the dollar. So it's less about fussing over the exact amount and more about making sure you get a payment that's pretty close in on time, and that's September 15th. All right. So
What you need in place to be able to pay your taxes every quarter, which you have to do when you are self-employed, when you run your own business. You need a system that's tracking your profit, right? In other words, bookkeeping. Now, this doesn't mean you actually need to go buy fancy bookkeeping software, though that might be appropriate. You might want it, right? A lot of us, for example, let's say you are a creative in tech.
Right. You work in the tech world and you left your job in tech to go out on your own full time. Well, for you, it may be that you don't actually need to set up complete bookkeeping on bookkeeping software and be paying that, you know, $50 monthly fee for your bookkeeping software. You may be just fine.
if you're freelance like that, you may be just fine going and doing it all on a spreadsheet, right? All you really need to know is your income from the business, your expenses from the business, take the difference, that is your profit, and you just make a calculation based on that. It's not rocket science, but it's very important that you do it. The more dialed in you get your bookkeeping, the better your estimates will be.
And the easier your tax time will be, the less headache you will have close to April 15th, because you will have been paying more accurately throughout the year, you'll have less reconciliation to do. And hopefully, if you have some special ninja tricks built into your bookkeeping, you will have an easier time just not having to go back and recalculate certain tax categories because you track them from the beginning.
Okay, this is one of the things that I like to teach because you can really save a lot of effort by a little bit of upfront work to kind of get your tracking a little more dialed in. So the takeaway here is bookkeeping doesn't need to be complicated, estimated tax paying does not need to be complicated, but they are both necessary and you need something. Okay. So if you take nothing else away today, that's a pretty good takeaway.
And I also have a video on my YouTube channel, and I'll link to it in today's show notes that shows you just a walkthrough video that I made on YouTube to show you literally screenshot by screenshot me paying my estimated taxes on the IRS website so that you know which buttons to click on that website because navigating it can feel a little bit tricky sometimes. So just click the show notes to get that video. It's a really nice walkthrough and it will help you. Okay.
so you gotta pay your quarterly taxes every quarter when you're self-employed. You need to be paying quarterly taxes. You need to have some bookkeeping set up. And it's even more helpful if you can dial it in so you track your tax categories with a little more precision to prevent recalculating a tax time and to basically keep things even smoother and even tighter. So if you're curious, I'm starting a new thing.
Right. I have been building over the summer, actually with my partner who is a software engineer. So we have a pretty sweet backend built. It's kind of incredible to have my own dev working on this. but we have been building a new program. and I'm doing a two-day intensive. So this is a two-day intensive for self-employed business owners who are making money.
But still aren't sure the business behind the scenes is set up correctly. All right. You will get the tax, bookkeeping, and legal side of your business properly set up in just two days. All right. and the point is to do it without feeling overwhelmed or alone. So this is a cohort experience. You will get to know the other people in the cohort. They are very wonderful, kind, like-minded small business owners like you.
and we'll be working. This is not just me teaching, this is work sessions in addition to teaching, and you will actually walk away with stuff set up. Okay. So over two days you'll be working with a licensed tax professional. That's me. And why is that so important? I I just want to highlight the fact that I have a license, I have due diligence requirements, I am required by my license to keep up with current tax law.
These are things that are not true of AI. I know a lot of you are asking your tax questions of AI, and I get it. I absolutely understand why that is so tempting. But I do just want to say I am a licensed tax professional, which means I actually have to do the due diligence to give answers that are correct. I do not hallucinate tax law the way that AI actually does.
And I have several examples of this. I have
Put in a tax problem one day and it gives me a certain answer of how much the tax savings would be. I put in the exact same problem the next day and got a different number, right? I also have had the experience of putting into Claude AI a tax problem. And I have the expertise to have done that math on my own.
And Claude's math came out different from my math. And so I went through and I checked line by line by line to find where the error was from Claude. And what I discovered was Claude was using the wrong tax law. I'm a licensed professional and I'm not allowed to do that. But Claude is allowed to do that. It's allowed to tell you the wrong answer on your taxes. So I do want to just highlight and underline that. While maybe asking some more general questions from AI is fine.
Specific tax questions that you can actually rely on, that still belongs in the zone of somebody with a license like myself. Okay, so in this intensive, over the two days you'll be working with a licensed, real-life human tax professional, which is me, to get your tax tracking organized, to calculate your next quarterly tax payment, and to improve your bookkeeping setup. Okay, so you can come as you are.
With your bookkeeping never having been set up at all, having been set up, but maybe completely messy and you're not really sure where things are. or maybe bookkeeping that you feel fine about and you just wanna tune it up and make it better, right? And we're gonna also determine, you're gonna determine in this two-day period which business licensing, insurance, and tax requirements actually apply to you.
So this is not just general advice. Again, the way that AI might give, or the way that, you know, a seminar to a huge array of people that are not self-employed, that are not solo businesses. This is gonna give you the answers at your scale, as a business of one, as a business that is not venture-backed, that is not raising equity, but a business that is bootstrapped, that is self-funded.
Where you maybe don't have like endless venture money to burn through. You have to actually watch your pennies and not just go out and get every bell and whistle that is available to you accounting-wise, but you're kind of concerned about making sure it's the right size for you and protects you and is what you need, but is not more than what you need. Okay. You won't leave this.
two-day session with another list of things to figure out, you will leave with a setup that you can trust. I think that's a pretty cool program. Tell me what you think. I'm really excited about it. It's brand new. It comes with a searchable database of me answering tax questions. So you can actually ask questions and you get to keep this. You can search the database, ask your questions, and it will point you to the place where I am giving the answer.
So that it won't hallucinate. Okay. It's gonna be a tax catalog where you can just find the answers to your questions in a way that you can trust. In a way that won't hallucinate. There's also one-on-one time. Now, this program is evolving. At the moment, I'm offering two one-on-one consults when you join this. you'll get one private consult with me before the two-day intensive, and you'll also get a private consult with me after.
So this is to make sure on the way in you're ready to go. You have prepared anything you need to, that any kind of snags that come up or any sort of like initial questions are answered right away, that you don't have to wait to ask your burning question. And also a one-on-one consult at the end, I think is important too, a little bit later, a little bit after the intensive.
To just make sure that everything has settled in well. Like, how's it going? How's it working? Any lingering questions, any hangups, any snags? So it'll do a little bit of troubleshooting afterwards as well. So you get to really feel good that you are getting a setup that works for you. I'm super excited about this program. I cannot wait to run my first cohort, and I'm excited to announce to you that I do have dates now. So the first beta.
Cohort is going to be September 14th and 16th. Those are the days. If you're curious about the hours, it's 11 to 5 East Coast time. So that's 8 to 2 Pacific. Those days will be pretty intense, but you're going to leave with a lot done. That's the beta group. And then the first official cohort goes the week after that, September 23rd and 24th. Also 11 to 5 p.m. East Coast time. So 8 to 2.
Pacific time. I'm so excited. If you want to join the wait list, it's not a commitment. You can join the wait list and never join. But if you're just interested, you want to know when they open. I should be opening signups by the end of this week, if all goes according to plan. So you can join the wait list at sunlighttax.com/intensive. Okay. you'll be the first to know when those spots are actually available.
I will warn you that I do have a number of people on the wait list now, probably enough to fill both cohorts. I'm keeping the cohorts very small and very tight. you're gonna get to know the people in the cohort, you're gonna get individual attention, and you know, it'll become your business buds that you can call on later on and stay in touch with. Yeah, so I'm super excited about this program.
I'm excited to be building a brand new thing. I'm trying to be transparent about my process here on my newsletter and in my podcast so that you can kind of be on this journey with me as I build a new thing to meet you where you're at today in today's world of overwhelm, info overwhelm, and also low trust. You know, I want you to feel really, really good that you are getting answers that are vetted from a tax professional and you know that you can trust them.
And that you build a setup that is really right for you, really individualized. Your questions are answered and you know it will work. So super excited about this intensive. Again, if you want to get on the wait list and be notified when those limited spots open up, it's going to be first come, first serve. you can go to sunlighttax.com/intensive. I really hope to hear what you have to think.
Hear you have to say about that program. If it sounds good to you, if you have questions, I absolutely welcome you to just ask anything that's on your mind. Will it do this? Will it do this? What if it doesn't work for me? What if I need it? You know, I'm not ready in September, but I'm hoping for November. Just let me know because I'm keeping lists. And yes, I do plan to offer this again, but the dates that I have available now are for September. All right, go forth, pay your third.
Estimated quarterly tax payment of the year by September 15th. It's time to get your bookkeeping going. Make sure you know your profit for the quarter in order to be able to make that payment. And I'll see you next week. Bye.