Can I Pay Estimated Taxes Annually Instead of Quarterly?

Technically, you can pay your estimated tax in one lump sum at the January 15 deadline rather than spreading it across four quarters — but this strategy has risks. The underpayment penalty is calculated quarterly, so if you had income earlier in the year and didn't pay by the earlier due dates, you'll owe a penalty for those quarters even if you pay in full by January. The safest approach is to spread payments to match when your income is earned. However, if your income is heavily weighted to the fourth quarter (like a year-end bonus or large business payment), making one January payment may actually be fine. Form 2210 calculates the penalty quarter by quarter.