01/06/2026
Homestead CFO 60: 2025 Q4 Tax quarterly Estimate due January 15!
As the Q4 Estimated Tax Deadline Is Right Around the Corner use this as a way to avoid costly IRS penalties.
What’s the penalty risk?
If you underpay your 2025 estimated taxes by more than 10%, the IRS may assess daily compounding interest on the shortfall.
The penalty generally applies if:
• You owe $1,000 or more at tax time, and
• Your total payments fall short of the required amount
Current IRS underpayment rates are running around 6–7% annually.
Two Ways to Avoid the Penalty
1️ Safe Harbor Method (Simplest Option)
• Pay at least 100% of your 2024 tax liability
(110% if your income exceeds $150,000)
• Payments are split into four equal quarterly installments
2️ Current-Year Method
• Pay at least 90% of your expected 2025 tax liability
• Quarterly payments can be adjusted based on actual income
Take a quick look at your December financials to see whether you meet one of these requirements. If not you might need to make a small Q4 payment now to avoid sending more money to the government later in penalties.
