How to Use IRS Form 1040-ES

The IRS provides Form 1040-ES for taxpayers to report and make estimated tax payments throughout the year on income that has not been subject to tax withholding, including income from self employment, consulting and contract work. Most taxpayers must make estimated payments if, for any given year, they expect to owe at least $1,000 and the total of their withholding and credits is less than 90 percent of their total taxes.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• Your tax return for the previous year
• IRS Form 1040-ES and Instructions

Use IRS Form 1040-ES to Make Estimated Tax Payments

1. Complete the estimated tax worksheet on Page 4 of the IRS Form 1040-ES Instructions to determine if you should make estimated tax payments and to calculate the amount you should pay in each of four equal estimated tax payments due April 15, June 15, September 15 and January 15.
2. Enter the amount from Line 17 of your estimated tax worksheet in the box at the upper right of each of Form 1040-ES payment voucher 1.
3. Fill in your name, Social Security number and address on each of the four Form 1040-ES payment vouchers.
4. Add your spouse's name and Social Security number if your payment is a joint payment and you intend to file your taxes jointly for this year.
5. Make a check or money order payable to "United States Treasury" for the amount in the box on Payment Voucher 1, with "2007 Form 1040-ES" and your Social Security number on the memo line of the check.
6. File your Estimated Tax Payment Voucher 1 with your payment by April 15 by mailing them to the applicable address for your state of residence from the address list on Page 6 above Payment Voucher 4 in IRS Form 1040-ES.
7. See Page 3 of IRS Form 1040-ES for instructions if you prefer to pay electronically by credit cards or electronic funds withdrawal or use the Electronic Federal Tax Payment System (EFTPS).
8. Repeat these steps for Payment Vouchers 2, 3 and 4 on June 15, September 15 and January 15, but amend your worksheet and payment structure during the course of the year if your estimated taxable income or other circumstances change. Note that these are not precisely calendar quarter dates.
9. Use the Record of Estimated Tax Payments at the top of Page 6 throughout the year to keep a record of each Payment Voucher and payment that you file.

Tips & Warnings

• Amend your Estimated Tax Worksheet and payment structure if your material circumstances and income change at any point during the year. If your income unexpectedly doubles each quarter, the IRS will not accept that you were strictly adhering to the worksheet you filled out in March or April as an excuse for a tax underpayment.