How to File Quarterly Estimated Taxes as a New Functional Medicine Practice

If you are a new functional medicine practice owner, you likely operate as a sole proprietor, LLC, or S-corp, and the IRS expects you to pay taxes on your income throughout the year, not just once at tax time. Quarterly estimated tax payments are how you do that. This guide walks you through the process, from calculating your estimated tax to making payments, with current 2026 figures and practical steps you can take this week.

Why You Need to Pay Quarterly Estimated Taxes

The U.S. tax system is pay-as-you-go. If you expect to owe at least $1,000 in federal taxes for the year (after credits and withholding), you must make estimated tax payments. For a new practice, this almost always applies because you have no employer withholding. If you do not pay enough during the year, you may face an underpayment penalty, which is roughly 8% of the unpaid amount for 2026, plus interest. Avoid that by planning ahead.

Step 1: Estimate Your Annual Income and Deductions

Start by projecting your practice’s net profit for the year. Use your business plan, current revenue trends, and expected expenses. For a new functional medicine practice, typical net profit margins range from 15% to 40% after all expenses, but your numbers will vary. Gather these figures:

• Revenue: Monthly patient visits, package sales, or telehealth fees. For example, if you see 20 patients a week at $150 per visit, that is $12,000 per month, or $144,000 annually.
• Expenses: Rent, supplies, software, marketing, insurance, and payroll if you have staff. Common expenses for a solo practice run $3,000 to $8,000 per month.
• Net profit: Revenue minus expenses. This is your taxable business income.

Use last year’s tax return if you have one, or create a simple spreadsheet. For 2026, the standard deduction is $15,000 for single filers and $30,000 for married filing jointly, but your itemized deductions may be higher if you have mortgage interest or large medical bills.

Step 2: Calculate Your Estimated Tax Liability

Your estimated tax includes income tax and self-employment tax (Social Security and Medicare). For 2026, the self-employment tax rate is 15.3% on net earnings up to $176,100 (Social Security wage base), then 2.9% for Medicare above that. Income tax rates for 2026 are the same brackets as 2025, adjusted for inflation: 10%, 12%, 22%, 24%, 32%, 35%, and 37%.

Here is a simplified calculation for a single filer with $100,000 net profit:

• Self-employment tax: $100,000 * 92.35% (deduction for half of SE tax) = $92,350 * 15.3% = $14,129.55
• Income tax: After the standard deduction of $15,000, taxable income is $85,000. Using 2026 brackets, the tax is roughly $14,500 (10% on first $11,600, 12% on income up to $47,150, 22% on the rest).
• Total estimated tax: $14,129.55 + $14,500 = $28,629.55

Divide by 4 to get your quarterly payment: about $7,157. This is an estimate; use IRS Form 1040-ES to calculate more precisely, or use tax software.

Step 3: Determine Your Payment Deadlines

For the 2026 tax year, the quarterly deadlines are:

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

If a deadline falls on a weekend or holiday, the payment is due the next business day. Mark these dates on your calendar now.

Step 4: Pay Your Estimated Taxes

The easiest way to pay is through the IRS Direct Pay system at irs.gov/payments. You can pay by bank account for free, or by credit card for a fee (around 1.85% to 2.9%). Alternatively, use the Electronic Federal Tax Payment System (EFTPS), which requires enrollment but is reliable for business payments. You can also mail a check with Form 1040-ES voucher, but that is slower and riskier for timely delivery.

For state taxes, check your state’s revenue department website. Most states have similar quarterly payment systems, and some accept payments through their own portals. For example, California uses FTB Web Pay, and New York uses the Department of Taxation and Finance online services.

Step 5: Adjust Payments as Your Income Changes

Your estimates are not set in stone. If your practice grows faster than expected, or you have a slow quarter, adjust your next payment. The IRS allows you to annualize your income if you have uneven earnings, which can reduce penalties. Keep track of your actual income monthly and compare it to your estimate. If you see a significant change, recalculate and pay the difference in the next quarter.

What If You Miss a Payment?

If you miss a deadline, pay as soon as possible. The IRS charges a penalty of 0.5% per month on the unpaid amount, up to 25%, plus interest. You can request a penalty waiver if it is your first time and you have a reasonable cause, but do not rely on that. Set up automatic reminders or use accounting software that tracks due dates.

Use a Tax Professional or Software

For a new practice, consider using tax software like QuickBooks Self-Employed or TurboTax, which can calculate your estimated taxes automatically. Or hire a CPA who specializes in small medical practices. A CPA can cost $300 to $800 for a quarterly review, but they can save you money by finding deductions you might miss, such as continuing education, equipment, and home office expenses.

FAQ

Q: Do I have to pay estimated taxes if I have an S-corp? A: Yes, if you are an owner-employee, you must pay yourself a reasonable salary and withhold payroll taxes. The corporation also pays estimated taxes on its income. Your personal estimated payments may be lower if you have withholding, but you still need to file quarterly if you expect to owe $1,000 or more.

Q: Can I skip a quarter if I have a slow month? A: No, you must make payments by each deadline. However, you can reduce your payment if your income is lower, as long as you pay at least 90% of your current year’s tax liability or 100% of last year’s liability (110% if your AGI was over $150,000).

Q: What happens if I overpay? A: You will get a refund when you file your annual tax return. The IRS does not pay interest on refunds, so it is better to aim for a small overpayment rather than a large one, but avoid underpayment penalties.

Q: Do state estimated taxes work the same way? A: Most states follow the federal schedule, but rates and thresholds vary. Check your state’s department of revenue for specific forms and deadlines. Some states have no income tax, like Texas and Florida, so you only pay federal.

The Bottom Line

Paying quarterly estimated taxes is a non-negotiable part of running a new functional medicine practice. Start by estimating your annual net profit, calculate your tax liability using Form 1040-ES, and pay by the four deadlines. Use IRS Direct Pay for convenience, and adjust your payments as your income changes. If this feels overwhelming, invest in a CPA or reliable tax software. The penalty for underpayment is avoidable with a little planning, and staying on top of your taxes will give you peace of mind as you grow your practice.

Related guides

• S-Corp vs LLC for New Functional Medicine Practices: Which Saves More on Taxes?
• What Taxes Does a New Functional Medicine Practice Pay? A Complete Guide