What is the federal safe-harbor rule for estimated taxes?

It lets you avoid an underpayment penalty by paying, across the year, the smaller of 90% of this year's actual tax or 100% of last year's tax, or 110% of last year's tax if your prior-year adjusted gross income was over $150,000.

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How much should I set aside for my next quarterly estimated tax payment on trading profits?

Q: How much should I set aside for my next quarterly estimated tax payment on trading profits?

Enter this year's estimated total tax, optionally last year's total tax and whether you're a higher earner, and what you've already paid this year. The tool applies the standard federal safe-harbor rule and shows what's due for the quarter you select.

The traders who last aren't the ones who never lose. They're the ones who never guess.

Jason Parker, Founder of Trading Habits

Enter Your Tax Numbers

Uses the standard federal safe-harbor rule: pay in the smaller of 90% of this year's tax or 100% (110% if you're a higher earner) of last year's.

This year's estimated total tax liability ($)

Include trading profits plus all other income. The Day Trading Tax Liability Estimator can help you get this number.

Last year's total tax liability ($, optional)

Leave blank to use only the current-year 90% safe harbor.

Was last year's adjusted gross income over $150,000 ($75,000 if married filing separately)?

No Yes

Estimated payments already made this year ($)

Which quarterly payment are you making?

Your Result

Fill in your tax numbers and click Calculate to see your suggested quarterly payment.

How this is calculated

The federal safe-harbor rule lets you avoid an underpayment penalty by paying, across the year in four installments, the smaller of 90% of this year's actual tax or 100% of last year's tax (110% if last year's adjusted gross income was over $150,000, or $75,000 married filing separately).
This tool calculates the smaller of those two safe-harbor totals, if you provide last year's tax, then divides it evenly across quarters and subtracts what you've already paid this year to show what's due now.
If you only enter this year's estimated tax, the tool uses the 90%-of-current-year safe harbor on its own, since it has no prior-year figure to compare against.
This does not account for withholding from a W-2 job, which counts toward your safe harbor the same as an estimated payment does, or for state estimated tax rules, which run separately from federal ones.
Quarterly due dates don't line up with calendar quarters exactly; confirm the actual IRS due dates for the current tax year before paying.

Risk & liability disclaimer: This calculator applies the standard federal estimated-tax safe harbor math to the numbers you enter. It is not tax advice and does not account for state tax rules, withholding from a job (which also counts toward the federal safe harbor), or other income timing. Trading Habits is not a broker-dealer, registered investment adviser, or tax professional, and is not affiliated with any broker, exchange, the IRS, or any tax authority. Consult a CPA or tax professional before making estimated tax payments. You could lose some or all of the capital you trade with.

How much should I set aside for my next quarterly estimated tax payment on trading profits?

Enter Your Tax Numbers

Your Result

How this is calculated

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