Form 1040-ES: Estimated Tax for Individuals (2026)
Pre-pay tax on income nobody withholds from — and avoid an underpayment penalty.
Form 1040-ES is the voucher and worksheet set for paying estimated tax in four installments. You generally avoid an underpayment penalty by pre-paying the lesser of 90% of this year's tax or 100% of last year's tax — 110% if your prior-year AGI was over $150,000 ($75,000 if married filing separately). The prior-year option is only available if that return covered a full 12 months.
Who files Form 1040-ES
- Self-employed people and 1099 contractors with no withholding.
- Investors with significant capital gains, interest or dividends.
- Retirees taking distributions without enough tax withheld.
- Anyone who expects to owe $1,000 or more after withholding and credits.
How the safe harbor actually works
There are two tests and you only need to satisfy the smaller one. The current-year test is 90% of what you will owe this year — which you can only estimate. The prior-year test is a known number from last year's return, which is why most people use it: 100% of last year's total tax, or 110% if your prior-year AGI exceeded $150,000 ($75,000 for married filing separately).
The 110% test keys off your PRIOR-year AGI, not what you expect to earn this year. A big current year does not push you to 110% if last year's AGI was modest. Withholding from any W-2 job counts toward these payments and is treated as paid evenly across the year, which is why increasing withholding late in the year can fix an underpayment that quarterly vouchers cannot.
When the prior-year option is not available
If your prior return covered less than 12 months, or you did not file at all, the prior-year safe harbor does not apply and only the 90%-of-current-year test is available — usually the larger number. Farmers and fishers have their own rules: generally 66 2/3% rather than 90%, with a single January installment, and no installment at all if the return is filed and the tax paid in full by March 1.
If your income arrives unevenly — a bonus, a property sale, seasonal business income — the annualized income installment method on Form 2210 Schedule AI can reduce or reschedule what you owe each quarter.
The installments are not quarters, and the penalty is not annual
The four periods are three months, two months, three months and four months long, and the last one is due in the following January. So the four payments are equal under the regular method while the periods they cover are not.
The part that costs people money is that IRC § 6654 computes an underpayment for each period separately and charges interest on each from its own due date. Paying the full safe-harbor amount by April of the following year does not undo a missed April installment. This is why dividing your annual target by four is only the right arithmetic before the first due date — after a missed installment, what is left over the remaining installments and what is owed on the periods already gone are two different amounts.
Frequently asked questions
What are the 2026 estimated tax due dates?
April 15, June 15 and September 15 of 2026, then January 15 of 2027. None of the four falls on a weekend or a federal holiday this year, so none shifts. In other years a date landing on a weekend or holiday moves to the next business day.
What if I underpay one quarter?
The penalty is computed per period, so a shortfall in one period is not cured by overpaying later — it keeps accruing until it is covered. There is one exception worth knowing: withholding is treated as paid in four equal amounts on the four due dates regardless of when it was actually withheld, so increasing withholding on a paycheck or a retirement distribution reaches backwards and can cure an earlier installment. An estimated payment is credited on the day you send it and cannot.
Do I owe a penalty if I pay in full by April?
Possibly yes. The underpayment penalty applies to missing the quarterly deadlines, not the filing deadline — paying everything at filing can still trigger it.
Is there a minimum below which I can skip estimates?
If your balance due after withholding and credits is under $1,000, the penalty generally does not apply. There is also an exception if you had no tax liability in a prior full 12-month year and you were a US citizen or resident for the whole of it.
How is the payment I send applied?
To the earliest installment that is still short, not to the quarter you sent it in. So a payment made in June when April was never paid clears April and leaves June open — which is why a taxpayer who thinks they are one quarter behind can be two.
Sources & verification
Last reviewed July 12, 2026.