Independent Contractors: Estimated Quarterly Tax

I know that at least a few of you out there are Independent Contract Designers, or "Freelancers." Have you gotten all the information you need to start paying your quarterly taxes? If you're independent, your employer is not paying quarterly taxes to the government on your behalf. (Yes, this is my home office in the picture :)

I thought I'd point out a few of the resources I discovered while trying to figure out my tax responsibilities as an independent contractor. First, here are the tax quarter break-downs and due dates according to my tax advisor:

April 15
(Jan - March 31st payment)

June 15
(Apr - May 31st payment)

Sept 15
(June - Aug 31st payment)

Jan 15
(Sept - Dec 31st payment)

You'll need to pay both Federal and State estimated taxes if you live in California. Here are links to sites that allow you to make your quarterly payments to the IRS, free of charge (and paper-free):

EFTPS (Federal)
CA Franchise Tax Board

Normally, an employer also pays half of your Social Security and Medicare obligation for you. As an Independent Contractor, you'll have to pay both your half as well as your employer's half (for a total of 15.3%), doubling what you would normally owe if you were conventionally employed. My tax guy advised me to pay around 25% of my income to Federal and 10% to State. We'll see a the end of the year whether I owe more or receive a refund based on these percentages.

All of this information is what I have come to understand while researching my own tax obligations. Before taking my word for it, make sure you do your own research and come to your own conclusions. It's better to be safe than sorry when it comes to taxes, so double-check these figures. If you know something I don't, please post it here so we can all benefit from the information.

If you need help getting started, you might want to take a peek at the small business section of the IRS website.