If your periodic withholding and estimates in 2025 are at least 100% / 4 = 25% ( 110% / 4 for certain high income taxpayers) of your 2024 tax, there will be no penalty on your 2025 tax return, regardless of any jump in income.
you are protected from a sudden capital gain or Roth conversion at year end.
you know your prior year's tax when you file by April 15, which is also the first estimated tax payment due date.
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IRS requires you to establish your Required Annual Payment for the year and pay as you go.
Assuning you have no W-2 withholding nor other withholding,
you can base your estimate on prior year's tax , or 90% of this year's tax, whichever is smaller.
each quarter your withholding and estimated tax paid must be at least 25% of the estimate, even if your income is uneven, [Otherwise, you will be penalized.] this is the simplified method, default.
if your estimate is based on this year's tax and turns out to be wrong you may be penalized.
you can compensate by overestimating.
if your estimate is based on prior year's tax, you know that when you file by April 15, which is also the first estimated tax payment due date. How convenient.
In other words, to avoid the complexity of 2210 Schedule AI, you must pay evenly over the year, or one or more periods might be penalized. If you did not act earlier, you have already missed the first payment of April 15.
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When to pay — Estimated tax payments are due four times a year:
April 15 for payment period January 1–March 31
June 15 for payment period April 1–May 31
September 15 for payment period June 1–August 31
January 15 for payment period September 1–December 31
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