If you made your Q2 estimated tax payment on June 15th, good, you can check that box. But before you set a reminder for September and move on, there’s something worth pausing on: the rules changed last year, and a lot of business owners are still calculating their estimated taxes the old way.
The One Big Beautiful Bill, signed into law on July 4, 2025, made sweeping changes to business taxation, including provisions that directly affect what you owe the IRS each quarter. Bonus depreciation came roaring back. The pass-through deduction became permanent. New deductions were added for tip income and overtime pay.
Each of those changes affects your taxable income. And your taxable income is exactly what you use to calculate your quarterly estimated payments.
If your Q1 and Q2 payments were based on last year’s numbers, or a projection that didn’t fully account for the new law, there’s a real chance your Q3 payment needs to look different.
Here’s what you need to know.
Unlike employees who have taxes withheld from every paycheck, most business owners (sole proprietors, partners, LLC members, and S-corp shareholders) are responsible for paying their own taxes on a quarterly schedule throughout the year. Miss a payment or underpay significantly, and the IRS charges an underpayment penalty, even if you pay everything you owe by April 15.
The 2026 estimated tax due dates are:
For most small business owners, the IRS “safe harbor” rules provide some protection. Generally, you can avoid penalties by paying either:
Safe harbor gives you a fallback, but it doesn’t mean you’re paying the right amount. If your business is growing, if you made major equipment purchases, or if the new tax law shifted your deduction profile, your actual 2026 liability could look very different from 2025.
One of the most significant provisions of the One Big Beautiful Bill was the restoration of 100% bonus depreciation, effective immediately. This means that if you purchased qualifying equipment, vehicles, or machinery in 2025 or 2026, you may be able to deduct the entire cost in the year of purchase, rather than depreciating it over several years.
For a business that spent $80,000 on a new truck or piece of manufacturing equipment, that’s an $80,000 deduction hitting your taxable income in one year. If you took that deduction on your 2025 return, your prior-year tax was artificially low, and the safe harbor based on that number may not protect you in 2026 if income rebounds.
Conversely, if you’re planning equipment purchases later this year, strategically timing those purchases could significantly reduce your Q3 or Q4 tax liability. That kind of planning should be part of your mid-year review.
The 20% deduction on qualified business income (QBI), sometimes called the Section 199A deduction, was scheduled to expire. The new law made it permanent. If you’re an LLC, S-corp, sole proprietor, or partnership, you likely already benefit from this deduction. Now that it’s permanent, you can incorporate it confidently into your long-term projections, including your estimated tax calculations for Q3 and Q4.
If you haven’t been fully accounting for the QBI deduction in your quarterly planning, you may actually be overpaying throughout the year.
For businesses in the restaurant, hospitality, and service industries, the new law created a federal deduction for tip income. For businesses that regularly pay overtime, construction, manufacturing, and retail, there’s now a deduction for overtime wages.
These deductions primarily benefit your employees as individuals. But as a business owner, you should be aware that they affect your payroll strategy and could influence how you structure compensation going forward. They also mean that some of your employees may owe significantly less in personal taxes, which could affect workforce decisions. We covered the compliance side of these changes in more detail in our earlier breakdown of the tips and overtime provisions.
If any of this applies to your business, it’s worth reviewing with a tax professional to understand the full picture before Q3.
The state and local tax (SALT) deduction cap increased from $10,000 to $40,000 under the new law, through 2029. For business owners who itemize deductions and pay significant property or state income taxes, this is especially meaningful in states like Maine, Massachusetts, and New Hampshire, where property values and state taxes can be substantial.
If you’re a business owner who also itemizes personal deductions, your personal tax liability may have decreased, which is relevant when calculating your overall estimated tax position.
Here’s the scenario we see every year: a business owner pays Q1 and Q2 based on rough estimates or prior-year numbers, doesn’t revisit the calculation until October, and then discovers they’ve been significantly off, either underpaying and facing a penalty, or overpaying and essentially giving the IRS an interest-free loan.
June is the ideal time to do a mid-year reset. You have six months of actual income data to work with. You know what equipment purchases you’ve made or plan to make. You understand how business is trending.
With that information, you can build a much more accurate projection for the rest of the year, and set Q3 up to be the right number, not a guess.
Estimated tax planning isn’t a once-a-year task you hand off to your accountant in March. It’s an ongoing process, and the business owners who pay the least in taxes legally are the ones who treat it that way.
At Cultivate, our Tax Planning and Strategy service is built around this kind of proactive tax advisory work. We don’t just prepare your return. We help you understand what your tax liability looks like throughout the year, identify opportunities to reduce it, and make sure your estimated payments are aligned with reality. If you want a fuller picture of how the new law reshaped the landscape, our recap of the major tax changes from the One Big Beautiful Bill is a good place to start.
After a year of sweeping tax law changes, now is not the time to set it and forget it.
[Callout Box] If you want to make sure your Q3 estimated payment reflects the new tax landscape, and that you’re not leaving money on the table between now and December, let’s talk. Book a mid-year tax planning call, and we’ll walk through your numbers together.
If you’re not convinced, let’s start with a quick conversation: reach out through our contact page. Either way, don’t let the September 15 deadline catch you off guard.
For official IRS guidance on estimated taxes for small businesses, visit IRS.gov: Estimated Taxes. For a full summary of One Big Beautiful Bill provisions, see the IRS One Big Beautiful Bill Act overview.
Christine Gervais
Christine Gervais is a licensed CPA, using her skills to help businesses grow and achieve their fullest potential. Christine has a Master’s degree in accounting from Southern New Hampshire University in addition to holding her CPA license for over a decade. Notably, Christine is a nationally recognized speaker providing education to other CPAs on how to best serve clients as well as instruction on a wide variety of topics for business owners on how to maximize success. Christine prides herself on the value she can bring to clients with her extensive tax knowledge and provides strategic, forward-thinking financial strategies to help clients grow. When not behind her desk, you can find Christine spending quality time with her daughter and stepson or tending to the family’s excessively loved farm animals.
