Missed an estimated tax payment on your payouts?

Updated November 1, 2026 · For the 2026 tax year

Pay as soon as you can. The IRS penalty depends on how much you underpaid and for how long, so each day you wait can add to it. You don't have to wait for the next due date, and a missed quarter doesn't mean you should skip the rest.

You may not owe a penalty at all

Most people avoid it if any of these apply:

• You owe less than $1,000 when you file, after withholding and refundable credits.
• You paid at least 90% of this year's tax during the year.
• You paid at least 100% of last year's tax during the year. That rises to 110% if last year's adjusted gross income was over $150,000, or $75,000 if married filing separately.

The test is whichever of the 90% or 100% (or 110%) amounts is smaller. It's also checked for each payment period, so a large payment in January may not fix an earlier quarter. The quarterly guide covers these rules.

How the penalty is worked out

The IRS looks at three things: how much you underpaid, how long it stayed unpaid, and its quarterly interest rate for underpayments. That rate is 7% a year for October to December 2026 and can change each quarter.

As a rough illustration at that rate, $2,000 underpaid for 90 days comes to about $35 ($2,000 × 7% × 90 ÷ 365). Your own figure depends on your dates and the rates in effect. The IRS works it out and sends a notice if you owe, or you can use Form 2210.

If your payouts came late in the year

The IRS generally assumes your income came in evenly, which can overstate the penalty if your first payout came in the fall. The annualized income installment method on Form 2210 matches payments to when you actually earned the income, which can lower or remove the penalty for earlier quarters. Ask your CPA to run it.

Have a day job?

Withholding is treated as paid evenly through the year unless you show otherwise, even if it's taken out in December. Extra withholding on a new Form W-4 can make up for missed quarters in a way a late estimated payment can't. See the year-end checklist.

Can the penalty be waived?

Only in limited cases, and the IRS says it generally can't be waived for reasonable cause alone. It may be removed or reduced after a casualty, disaster or other unusual circumstance, or if you retired after 62 or became disabled in the last two years and had reasonable cause. A request has to be in writing.

How to catch up

1. Get your current number from the free calculator.
2. Pay through your IRS Online Account or IRS Direct Pay, and choose estimated tax for the right year. More in the January payment guide.
3. Set aside a percentage of each new payout, so the next date is covered.
4. Check your state, which may have its own estimated payment rules.

These are planning estimates, not tax advice: confirm with a CPA.

Sources

• IRS, Topic 306, Penalty for underpayment of estimated tax: the $1,000, 90% and 100% tests, Form 2210, annualized installments
• IRS, Underpayment of Estimated Tax by Individuals Penalty: how it's figured, notices, waivers and reasonable cause
• IRS, Quarterly interest rates: the 7% rate for the fourth quarter of 2026
• IRS, Instructions for Form 2210: withholding treated as paid evenly
• IRS, 2026 Form 1040-ES: the $150,000 and $75,000 thresholds

General information, not tax advice. This guide explains common rules for US funded traders; your situation may differ. It isn't a substitute for a licensed CPA or IRS enrolled agent, so review your own numbers with one before you file or pay.