Ep. 6 - Paying estimated taxes quarterly when you're self-employed

Paying estimated taxes can be a little confusing so I break down exactly how to determine how much you need to pay in Federal taxes quarterly. The example I use takes a barber estimating he'll make $90,000 a year. Step 1: Estimate Self Employment tax Using the example: $90,000 x 92.35% = $87,115 $87,115 x 15.3% = $12,716.59 Step 2: Determine taxable income Step 3: Calculate Income Tax Step 4: Add Self Employment tax and Income tax Step 5: Divide estimated annual tax by 4