“Quarterly taxes” aren’t four extra taxes freelancers suddenly have to pay.
When you go freelance, the important change is how you pay your taxes—and the self-employment tax you now need to account for.
We break it down with actual numbers.
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Quarterly Taxes, Explained: What Freelancers Are Actually Paying
One of the more alarming pieces of advice new freelancers hear is: “Don’t forget about quarterly taxes.” It can sound as though becoming self-employed suddenly creates 4 new tax bills a year. It doesn’t. Quarterly estimated taxes are a way of paying taxes you would owe anyway. When you are an employee, your employer withholds federal income tax, Social Security, and Medicare from each paycheck and sends that money to the government.