This page provides general educational information only. It is not tax, legal, or financial advice. For official California estimated tax information, visit FTB — Estimated Tax Payments and IRS — Estimated Taxes. Dollar thresholds and rates shown are for tax year 2024 and may change; verify on FTB.ca.gov and IRS.gov before acting.
What are estimated tax payments?
Estimated tax payments are advance payments of income tax made throughout the year — before you file your annual return. The U.S. tax system is pay-as-you-go: you are generally required to pay tax on income as it is earned, not just when you file. For employees, this happens automatically through withholding. For income not subject to withholding — self-employment income, investment income, rental income, and similar sources — you may be required to make estimated payments directly to the IRS and to California.
Federal source: IRS — Estimated Taxes
California source: FTB — Estimated Tax Payments
Who needs to make estimated tax payments?
Federal
You generally must make federal estimated payments if you expect to owe at least $1,000 in federal tax after subtracting withholding and refundable credits, and your withholding and credits will be less than the smaller of: (1) 90% of the tax shown on your current year return, or (2) 100% of the tax shown on your prior year return (110% if prior year AGI was over $150,000). Source: IRS Form 1040-ES Instructions. Tax year 2024 thresholds; verify on IRS.gov.
California
You generally must make California estimated payments if you expect your California net tax liability to exceed $500 ($250 if married and filing separately), after subtracting withholding and credits. California uses a different payment schedule than the federal government. Source: FTB — Estimated Tax Payments. Tax year 2024 threshold; verify on FTB.ca.gov.
Federal vs. California estimated tax schedules
The payment schedules differ between the IRS and California FTB. This is a common source of confusion.
Federal estimated tax due dates (tax year 2024)
| Payment period | Due date |
|---|---|
| January 1 – March 31 | April 15 |
| April 1 – May 31 | June 15 |
| June 1 – August 31 | September 15 |
| September 1 – December 31 | January 15 of following year |
Source: IRS — Estimated Taxes
California estimated tax due dates (tax year 2024)
| Installment | Amount | Due date |
|---|---|---|
| 1st installment | 30% of estimated tax | April 15 |
| 2nd installment | 40% of estimated tax | June 15 |
| 3rd installment | 0% — no payment due | (none) |
| 4th installment | 30% of estimated tax | January 15 of following year |
California’s schedule is weighted differently than federal — 30/40/0/30 vs. 25/25/25/25 — and has no third-quarter payment. Source: FTB — Estimated Tax Payments. Verify current schedule on FTB.ca.gov each year.
What happens if you underpay
If you do not pay enough through withholding and estimated payments during the year, you may owe an underpayment penalty when you file your return — even if you pay the remaining balance in full when you file.
Federal: The IRS calculates the underpayment penalty using Form 2210. Source: IRS Form 2210.
California: The FTB calculates California underpayment penalties using Form 5805. Source: FTB Form 5805.
There are safe harbor rules (both federal and California) that eliminate or reduce the underpayment penalty if you paid a sufficient amount based on prior-year tax liability. The specifics of those safe harbors are defined in each agency’s instructions.
How to make California estimated payments
- Online via FTB Web Pay
- By mail with FTB Form 540-ES (Estimated Tax for Individuals)
- Through your tax software or with a tax preparer
When professional help is appropriate: If you have variable income (freelance, investments, rental property, or business ownership), accurately estimating quarterly payments is complex. A miscalculation in either direction — overpaying or underpaying — has cash flow or penalty consequences. A CPA or enrolled agent can help you calculate appropriate estimates. Verify any California-based preparer before hiring.
Frequently asked questions
Do I have to make estimated payments if I had a refund last year?
Not necessarily, but it depends on this year’s income and tax situation. If your income or deductions change significantly, a prior-year refund does not mean you will not owe this year. The safe harbor rules (paying at least 100% of prior-year tax, or 110% if prior-year AGI exceeded $150,000) are the most commonly used method to avoid underpayment penalties.
Can I skip the fourth installment if I file my return early?
Yes. If you file your federal return and pay any balance due by January 31, you can skip the January 15 fourth-quarter estimated payment. California has an equivalent provision. Source: IRS Form 1040-ES Instructions and FTB estimated tax instructions for the current year.
What if I receive a large amount of income late in the year?
The annualized income installment method (federal Schedule AI of Form 2210, entered on Form 2210 Part III, line 10; California Form 5805, Part III) lets you calculate payments based on when income was actually received rather than evenly throughout the year. This can reduce or eliminate underpayment penalties if income was unevenly distributed.
Does California have a different safe harbor threshold than the federal government?
Yes. Verify the current California safe harbor thresholds in the FTB’s estimated tax instructions for the applicable year at FTB.ca.gov, as they differ from IRS thresholds.
Not reviewed by a credentialed tax professional. Amounts and thresholds are for tax year 2024; verify current figures on FTB.ca.gov and IRS.gov before acting. Official sources: FTB — Estimated Tax Payments and IRS — Estimated Taxes.