Self employed

Hi @mceasley and thanks for your question!

The IRS calls it a "penalty" for not paying estimated taxes - however it is different than other tax penalties. It's really interest your paying. You may not get it exactly correct and that's ok! The "penalty" may be there but it's a small percentage. I find that most people are more concerned about owing a large amount in April - quarterly payments help you reduce this amount. The general idea is you total up your self employed revenues and subtract out your expenses. You then multiply this amount by your income tax bracket percentage to give you a general idea of how much you need to pay in estimated taxes. This number divided by 4 is your approximate quarterly payment. Here's an article to help you with this: TurboTax Guide to estimated taxes.  

Here is a link to help you determine which tax bracket you are in: TurboTax Income Tax Bracket Calculator  

To determine which expenses will reduce your LLC income, you generally want to consider any and all expenses that are business related. You can take a deduction for your home office. You either take a percentage of actual expenses like your internet bill, or you can take the Simplified Home Office Deduction where you take a flat amount based on the size of your office. I am a big fan of this simplified method. If you take actual expenses you need to track depreciation if you own your home, which can get tricky if you need to know what it is 5 or 15 years from now. 

Here's our guide to the Home Office Deduction: Home Office guide