Mid-Year Tax Tip for Small Business Owners: Time to Review Your Estimated Tax Payments
As we pass the halfway point of the year, it’s a smart time for small business owners to take a closer look at their estimated tax payments. Many business owners set their estimates early in the year and forget about them—but your business finances can change quickly.
If your income is coming in higher or lower than you expected, now’s the time to review and adjust those estimated payments before it’s too late.
Why This Matters:
Failing to pay enough throughout the year could leave you with:
- Underpayment penalties from the IRS
- A large unexpected tax bill come next April
At the same time, overpaying your estimated taxes ties up your cash unnecessarily—money that could be reinvested in your business or used for other needs.
Key Questions to Ask Right Now:
- How does your year-to-date profit compare to what you projected?
- Do you expect your income to stay consistent, increase, or decrease for the rest of the year?
- Have there been any major business changes (new contracts, lost clients, new expenses, etc.)?
Next Steps:
- Run a Mid-Year Profit & Loss Report.
- Project your total income for the year based on current trends.
- Recalculate your estimated tax payments.
- Adjust your next payment as needed.
Important Deadline:
The next quarterly estimated tax payment is due September 16, 2025. Adjusting now gives you time to course-correct smoothly.
Bonus Tip:
If you’re unsure how to recalculate your estimates or how much you should pay, this is a great time to reach out to your tax advisor. A quick check-in now could save you penalties—and a big headache—later.