Year-Round Tax Plan
A sample written tax plan
This is the written plan a Year-Round Tax Plan client receives, filled in for a fictional client. Every name and number here is invented for illustration; your plan uses your own numbers.
Client snapshot
Alex R. (fictional) is single, lives in Naperville, Illinois, and has a W-2 job plus a rideshare business run through a single-member LLC. The question: “I owed $4,100 last April. How much will I owe for 2026, and what can I still do before December 31?”
| Filing status | Single, no dependents |
|---|---|
| W-2 wages | $58,000 |
| Rideshare gross receipts (1099-K) | $60,000 |
| Business expenses (standard mileage, phone, fees) | $18,000 |
| Net self-employment profit | $42,000 |
| Federal tax withheld from W-2 | $5,200 |
| Federal estimated payments made so far | $3,000 |
| Health coverage | High-deductible plan through work, no HSA yet |
| 2025 total federal tax | $12,900 |
2026 tax projection
If nothing changes, Alex will owe about $8,530 in federal tax and $1,960 to Illinois when filing in April 2027, and an underpayment penalty is likely.
| Line | Federal | Illinois |
|---|---|---|
| Self-employment tax (15.3% of 92.35% of $42,000) | $5,934 | not taxed |
| Adjusted gross income (after half of SE tax, $2,967) | $97,033 | $97,033 |
| Standard deduction / Illinois exemption | $16,100 | about $2,850 |
| Qualified business income deduction (20%) | $7,807 | none |
| Taxable income | $73,126 | about $94,180 |
| Income tax | $10,800 | $4,662 (4.95%) |
| Total tax | $16,734 | $4,662 |
| Paid so far | $8,200 | $2,700 withheld |
| Projected balance due | $8,534 | $1,962 |
Uses the IRS's 2026 tax brackets and standard deduction. The Illinois exemption shown is the 2025 amount.
Strategy comparison
The recommendation: do the first three now and skip the S-Corp election for 2027. Together they cut 2026 tax by about $2,950 and remove the penalty risk.
| Strategy | Estimated 2026 saving | Cost or trade-off | Deadline | Recommendation |
|---|---|---|---|---|
| SEP-IRA contribution of $7,807 (20% of net self-employment earnings) | $1,374 federal + $386 Illinois | Money stays in a retirement account until age 59½ | Tax filing deadline, including extensions | Yes |
| HSA contribution of $4,400 (2026 self-only limit; employer HSA money counts toward it) | $968 federal + $218 Illinois | Only if the work plan is HSA-eligible | April 15, 2027 | Yes, if eligible |
| Add $4,700 to W-2 withholding for the rest of 2026 | No tax saving; avoids the underpayment penalty | Smaller paychecks in November and December | Last 2026 paycheck | Yes |
| S-Corp election for 2027 | About $1,840 less SE tax on $12,000 of profit above a $30,000 salary | Loses about $1,190 of QBI deduction, plus payroll costs, a separate business return and Illinois's 1.5% replacement tax | March 15, 2027 (Form 2553) | Not yet; revisit when profit passes about $70,000 |
Why withholding instead of a January payment: the IRS treats withholding as paid evenly through the year, so it also covers the earlier quarters.
Action plan
With these five steps, the April 2027 federal bill drops from $8,534 to about $1,490.
- November 16, 2026: Give the employer a new Form W-4 adding $4,700 of extra withholding (Step 4c).
- December 31, 2026: Keep the 2026 mileage log complete.
- January 15, 2027: Pay the Illinois fourth-quarter estimate of $1,962 (Form IL-1040-ES).
- April 15, 2027: Contribute $4,400 to the HSA for 2026, after HR confirms the plan is HSA-eligible.
- April 15, 2027: Open a SEP-IRA and deposit $7,807 (or by October 15, 2027 if the return is extended).
2027 estimated tax payments
To stay penalty-free in 2027, Alex pays $2,298 each quarter: 2026 tax after the plan ($14,392) less expected W-2 withholding ($5,200), split four ways.
| Due date | Federal amount |
|---|---|
| April 15, 2027 | $2,298 |
| June 15, 2027 | $2,298 |
| September 15, 2027 | $2,298 |
| January 18, 2028 | $2,298 |
January 15, 2028 is a Saturday and January 17 is Martin Luther King Jr. Day, so the last payment is due January 18.
Assumptions and limits
A plan is based on the information the client gives and on federal and Illinois tax law as of its date. Projected amounts are estimates, not guarantees. This sample assumes November and December income continues at the same monthly rate, no other income, credits or itemized deductions, and the standard mileage rate. USTAXX Consulting Services is an IRS Authorized e-file provider; we are not a CPA firm and do not provide accounting or bookkeeping.
Get a plan built on your own numbers
Start with the $195 assessment. The Year-Round Tax Plan is $4,000 a year, billed $1,000 per quarter, with your personal and business returns included.