What Are the Quarterly Months for Business & Taxes?

Businesses and individuals often divide the year into smaller periods for financial and operational purposes. These periods, known as “quarters,” provide a structured way to track progress, analyze performance, and meet obligations. Understanding these divisions is fundamental for financial planning and accurate reporting.

Understanding Standard Calendar Quarters

A standard calendar year is divided into four calendar quarters, each three months long. The first quarter (Q1) spans January through March. The second quarter (Q2) includes April, May, and June. The third quarter (Q3) covers July, August, and September. The fourth quarter (Q4) comprises October, November, and December.

Quarters in Financial Reporting

Businesses use these three-month periods for financial reporting, which helps assess performance and make informed decisions. Publicly traded companies are required to prepare and disclose quarterly financial statements. These reports provide a snapshot of a company’s financial health, detailing revenue, expenses, profits, and cash flow for the specific three-month period.

Quarterly reports inform stakeholders, including investors and analysts, by offering timely updates on a company’s performance. These regular disclosures allow for continuous tracking of progress throughout the year, rather than waiting for annual summaries. Companies also use these reports internally to monitor financial standing, compare results against targets, and identify areas for improvement.

Quarterly Estimated Tax Payments

Certain individuals and businesses are required to make estimated tax payments throughout the year, which are structured around quarterly periods. This requirement applies to those who receive income not subject to sufficient tax withholding, such as self-employed individuals, business owners, and those with significant investment income. The purpose of these payments is to ensure taxpayers meet their tax obligations incrementally, rather than facing a large tax bill at year-end.

The Internal Revenue Service (IRS) sets specific due dates for these quarterly estimated tax payments, which fall on April 15, June 15, September 15, and January 15 of the following year. If any of these dates land on a weekend or legal holiday, the deadline shifts to the next business day. For example, the payment for income earned from January 1 to March 31 is due by April 15, while income from April 1 to May 31 has a June 15 deadline. The payment for June 1 to August 31 is due September 15, and for September 1 to December 31, the payment is due January 15 of the subsequent year.

Taxpayers need to make these payments if they expect to owe at least $1,000 in taxes after accounting for any withholding and refundable credits. Corporations must make estimated tax payments if they expect to owe $500 or more. Failing to make required payments on time can result in penalties for underpayment.

Fiscal Quarters Compared to Calendar Quarters

While calendar quarters follow the standard January-to-December year, fiscal quarters offer businesses flexibility in defining their financial reporting periods. A fiscal quarter is a three-month span within a company’s chosen fiscal year, which may not align with the standard calendar year. For example, a business might choose a fiscal year beginning July 1, making its first fiscal quarter (Q1) run from July through September.

This means a company’s fiscal quarters could differ significantly from calendar quarters. The choice of a fiscal year end often depends on a company’s business cycle or operational peak seasons. Consequently, financial results reported by different companies, even for the “same” quarter, might cover different periods, impacting direct comparability.