The 1040ES form asks for the income that a taxpayer makes during the tax year that is not subject to withholding in order to calculate the estimated tax owed, according to the Internal Revenue Service. Such income may include earnings from self-employment, rents, alimony, dividends and interest. If the taxpayer does not originally choose to have taxes withheld from government benefits, the 1040ES form can be used to calculate taxes owed on such benefits as unemployment compensation and Social Security.Continue Reading
The instructions for the 1040ES form include worksheets to calculate the differences between the previous year's and current year's incomes to help figure out estimated taxes owed, reports Intuit. Such calculations are based on estimated taxable income for the current year and estimated taxes owed in comparison with taxes paid the previous year. The amount of estimated taxes to be paid each quarter during the current year, as calculated in the 1040ES form, is either 90 percent of the expected taxes owed for the current year or the amount of taxes paid the previous year, whichever is lower.
The 1040-ES form and the estimated tax payment are due on April 15, June 15 and September 15 of the current tax year and on January 15 of the following year, explains Intuit. If a U.S. citizen or resident taxpayer owed no taxes the previous year, then no estimated taxes have to be paid for the current year.Learn more about Taxes