A fiscal quarter is one of the four consecutive periods that divide a fiscal year, normally three calendar months each. Its months follow the entity’s own fiscal year rather than the calendar year, so the first quarter begins in the fiscal year’s first month, whatever month that happens to be. The fiscal year itself and the tax-year distinction are defined in fiscal year. The interim report a public company files for the first three of its quarters is Form 10-Q.
Which Months Each Fiscal Quarter Covers, Q1 Through Q4
Count from the year’s first month, not from January. A client whose fiscal year runs January to December has Q1 in January, February and March, Q2 in April, May and June, Q3 in July, August and September, and Q4 in October, November and December. Move that same client to a June year end and every quarter moves with it: Q1 becomes July, August and September, Q2 becomes October, November and December, Q3 becomes January, February and March, and Q4 becomes April, May and June. Q4 is always the three months that close the fiscal year, and it matches the calendar’s final quarter only when that year ends in December.
The Payroll Quarter Is Not a Fiscal Quarter
One set of quarters in a firm’s workflow ignores the client’s fiscal year. Employment tax on wages is reported on Form 941, the Employer’s QUARTERLY Federal Tax Return, and its quarters are stated in named calendar months: the first covers January, February and March and ends March 31, the second covers April, May and June and ends June 30, the third covers July, August and September and ends September 30, and the fourth covers October, November and December and ends December 31 (IRS, Instructions for Form 941).
Those months are the same whatever annual accounting period the employer keeps its books on. So a client with a June year end closes its own Q4 in June while filing the second employment tax quarter for those same three months, and a firm scheduling that client’s work is tracking two quarter calendars at once. The dates each of those quarter ends triggers are worked out one by one in IRS business tax filing deadlines.
Quarters Inside a 52-53-Week Fiscal Year
A week-based year does not produce month-end quarters. The election behind it fixes a fiscal year that varies from 52 to 53 weeks and always ends on the same day of the week (26 CFR 1.441-2(a)(1)). Quarters counted in whole weeks from that year’s start therefore end on the same weekday rather than on the last day of a month, and the date moves against the calendar from one year to the next. The election itself, and how far a year end may sit from the month end, are set out in fiscal year.
Estimated Tax Installments Are Not Quarters Either
Estimated tax carries the quarterly label, and the periods behind that label are not equal. There are 4 required installments for each taxable year. An individual’s fall on April 15, June 15, September 15 and January 15 of the following taxable year (26 U.S.C. 6654(c)), and a corporation’s on April 15, June 15, September 15 and December 15 (26 U.S.C. 6655(c)). What keeps an installment period from being a quarter is that spacing: 2 months, then 3, then 3 for a corporation, and 2, 3 and 4 for an individual.
Those dates are the calendar-year reading. In applying either section to a taxable year beginning on any date other than January 1, the months which correspond thereto are substituted for the months the section specifies (26 U.S.C. 6654(k)(1), 26 U.S.C. 6655(i)(1)), so a fiscal-year corporation pays on the 15th day of the 4th, 6th, 9th and 12th months of its own tax year. The installments therefore move with the fiscal year, which the employment tax quarters do not.
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