How to File Quarterly Estimated Taxes as a New Advisory Firm

2026-08-21

Learn the step-by-step process for filing quarterly estimated taxes as a new advisory firm, including deadlines, calculation methods, and payment options.

If you’ve launched an advisory firm, you’re now responsible for paying taxes on your income throughout the year, not just at tax time. The IRS requires you to pay estimated taxes quarterly if you expect to owe at least $1,000 in tax for the year. This guide walks you through the exact steps to calculate, file, and pay your quarterly estimated taxes, with realistic figures for 2026.

Step 1: Determine If You Need to Pay Estimated Taxes

As a new advisory firm, you’ll likely need to pay estimated taxes if you’re a sole proprietor, partner, S-corp shareholder, or C-corp owner who doesn’t have enough tax withheld from other income. The IRS rule: pay estimated tax if you expect to owe at least $1,000 in tax for the year, after subtracting withholding and credits. For 2026, the safe harbor thresholds are:

If your 2025 adjusted gross income (AGI) was $150,000 or less, pay 100% of your 2025 tax liability.
If your 2025 AGI was over $150,000, pay 110% of your 2025 tax liability.
If you didn’t file a 2025 return, pay 90% of your 2026 tax liability.

Most new advisory firms will owe more than $1,000, so plan to pay quarterly.

Step 2: Estimate Your Income and Deductions

To calculate your estimated tax, you need to project your taxable income for the year. For a new advisory firm, this includes:

Revenue from client fees, typically 1% of assets under management (AUM) or flat fees ranging from $2,000 to $10,000 per client annually.
Deductions: business expenses like office rent ($500-$2,000/month), software subscriptions (e.g., CRM at $50-$150/month, portfolio management at $100-$500/month), professional liability insurance ($1,500-$5,000/year), marketing, and continuing education.
Self-employment tax: 15.3% on net earnings (12.4% Social Security up to the wage base, 2.9% Medicare), plus 0.9% additional Medicare on income over $200,000 (single) or $250,000 (married filing jointly).

Use last year’s tax return if you have one, or create a simple profit and loss projection for the current year. Be conservative: overestimate income slightly to avoid underpayment penalties.

Step 3: Calculate Your Estimated Tax Using Form 1040-ES

Use IRS Form 1040-ES to calculate your estimated tax. The form includes a worksheet that walks you through:

Adjusted gross income (AGI) projection.
Deductions and exemptions.
Tax on the projected income (use the 2026 tax brackets).
Self-employment tax.
Credits and payments.
Total estimated tax, divided by 4 for quarterly payments.

For example, if your projected net income is $100,000, your estimated federal tax might be around $18,000 (income tax) plus $14,130 (self-employment tax), totaling $32,130. Divide by 4: $8,032.50 per quarter. State taxes vary; check your state’s tax agency for their estimated tax requirements.

Step 4: Know the Quarterly Deadlines for 2026

The IRS deadlines for 2026 estimated tax payments are:

Q1: April 15, 2026 (for income earned January 1 to March 31)
Q2: June 15, 2026 (for income earned April 1 to May 31)
Q3: September 15, 2026 (for income earned June 1 to August 31)
Q4: January 15, 2027 (for income earned September 1 to December 31)

If a deadline falls on a weekend or holiday, the due date moves to the next business day. Mark these dates in your calendar and set reminders two weeks ahead.

Step 5: Choose a Payment Method

You have several ways to pay your quarterly estimated taxes:

IRS Direct Pay: Free, allows direct payment from your bank account. You can schedule payments up to 30 days in advance.
Electronic Federal Tax Payment System (EFTPS): Free, requires enrollment, good for businesses. You can schedule payments.
Credit/debit card: Convenient but incurs a fee (around 1.87% for debit, 2.89% for credit, with a minimum fee of $2.50).
Check or money order: Mail with Form 1040-ES voucher, but slower and requires postage.

For state taxes, use your state’s online portal or mail-in voucher.

Step 6: Track Your Payments and Adjust as Needed

Keep a record of each payment: date, amount, and confirmation number. If your income changes mid-year (e.g., you land a big client or lose one), recalculate your estimated tax and adjust the next payment. The IRS allows you to pay more or less in later quarters to catch up, as long as you meet the safe harbor rule.

Step 7: Avoid Underpayment Penalties

The IRS charges a penalty if you underpay your estimated tax. The penalty is based on the amount underpaid and the number of days it’s late. To avoid it, ensure your quarterly payments meet one of these safe harbors:

Pay 100% of last year’s tax (110% if AGI > $150,000).
Pay 90% of this year’s tax.

If your income is uneven, consider using the annualized income installment method (Form 2210) to align payments with actual income.

FAQ

Q: What if I miss a quarterly deadline? A: Pay as soon as possible. The penalty is calculated from the original due date, so the sooner you pay, the lower the penalty. You can also request a penalty waiver if it’s your first time and you have reasonable cause.

Q: Can I pay estimated taxes from my business account? A: Yes, but if you’re a sole proprietor, it’s fine to pay from your personal account. For S-corps or C-corps, pay from the business account. Just ensure you track the payment for tax purposes.

Q: Do I need to file a separate form for state estimated taxes? A: Most states require estimated payments, but the form and process vary. Check with your state’s department of revenue. Some states accept federal Form 1040-ES calculations.

Q: What if I have a loss in a quarter? A: You can reduce or skip a payment, but be sure to recalculate for the year. If you overpay, you’ll get a refund when you file your annual return.

The bottom line

Filing quarterly estimated taxes as a new advisory firm is a manageable process if you stay organized. Start by projecting your income and deductions, calculate using Form 1040-ES, and pay by the deadlines. Use IRS Direct Pay or EFTPS for free, easy payments. Track everything and adjust as your income changes. If you’re unsure, consult a CPA who works with advisory firms; they can help you set up a system and avoid penalties. Take action this week: estimate your 2026 income, calculate your first payment, and mark the April 15 deadline on your calendar.