First year doing gig work - how much should I pay in Q4 estimated taxes?

This is my first full year doing Uber and DoorDash. Made about $42,000 total (after gas and expenses, net is probably $30K).

I haven't paid ANY quarterly taxes because I didn't know I was supposed to. Q4 payment is due January 15. How much should I pay to avoid penalties?

Also - do I calculate based on gross ($42K) or net after expenses ($30K)?

You calculate based on NET income after deducting business expenses. So $30K net.

What you'll owe for 2025:

• Self-employment tax: ~$4,200 (15.3% of $30K less the 50% SE tax deduction)
• Federal income tax: ~$1,800 (varies by filing status)
• California state tax: ~$900
• Total: ~$6,900

Since you haven't paid any quarterly estimates, pay at least $6,000-7,000 by January 15 to minimize penalties. The IRS charges penalties for underpayment throughout the year, but paying Q4 is better than waiting until April.

Use a gig worker tax calculator to get your exact quarterly obligation for 2025 and set aside money each month.

$7,000?! I don't have that saved up. What happens if I can only pay like $3,000 now?

Pay whatever you can now, then pay the rest when you file in April. You'll owe penalties but they're not terrible - usually around 5-8% annually on the underpaid amount.

For 2025, set aside 25-30% of EVERY payment immediately. Open a separate savings account for taxes and don't touch it.

Also track ALL deductions:

• Mileage (67 cents per mile in 2024)
• Phone bill (business %)
• Car washes
• Parking fees
• Tolls
• Supplies

These save you thousands.

UPDATE: Paid $3,500 for Q4 via IRS Direct Pay. Will pay the rest in April.

Also went through my Uber and DoorDash records - I drove 28,000 miles this year! At 67 cents/mile that's $18,760 in deductions. My net income is way lower than I thought.

Might actually get a refund instead of owing more. Lesson learned - track EVERYTHING.

First year doing full-time gig work (DoorDash + Uber). Nobody told me about quarterly estimated taxes. I've earned $48K this year and haven't paid any taxes yet. How much trouble am I in?

Don't panic, but act now. Here's your situation:

What you owe (rough estimate on $48K):

• Self-employment tax: ~$6,800 (15.3% on 92.35% of net income)
• Federal income tax: ~$3,500-$5,500 (depends on filing status and deductions)
• State income tax: varies
• Total estimate: $10,000-$13,000

Penalties: The underpayment penalty is currently about 8% annualized on the unpaid amount. For your situation, that's probably $400-$800 in penalties. Annoying but not catastrophic.

Deductions to reduce your bill: Mileage (67¢/mile for 2026 — this is usually the biggest deduction for gig drivers), phone bill (business %), bags/supplies, car maintenance. Track these NOW for the rest of the year.

Action items: (1) Make a large estimated payment NOW via IRS Direct Pay (irs.gov) to stop the penalty clock, (2) set up quarterly payments going forward (Q1: Apr 15, Q2: Jun 15, Q3: Sep 15, Q4: Jan 15), (3) open a separate savings account and set aside 25-30% of every payment.