26 — Estimated Tax Payments Updated for tax year 2025

What this line means

The total of quarterly estimated tax payments you made during the year using Form 1040-ES, plus any amount you applied from your prior year’s refund. Self-employed filers, investors with significant capital gains, and retirees without sufficient withholding use estimated payments to stay current with the IRS throughout the year.

Does this apply to you?

• You are self-employed and made quarterly estimated tax payments
• You applied part or all of your prior year’s tax refund to this year’s estimated tax
• You have significant investment income not subject to withholding
• You are retired and chose to make estimated payments instead of having tax withheld from your pension or Social Security

Easy to overlook

Prior year’s overpayment applied to this year counts here If you chose to apply your prior year’s refund to this year’s estimated tax (line 36 on last year’s return), that amount counts as an estimated payment on line 26 this year. Filers sometimes forget they made this election and do not include it, which understates their payments and can create an apparent balance due. ¹ [SOURCE: IRS Publication 505 — Tax Withholding and Estimated Tax]

State estimated payments are separate Federal estimated payments (Form 1040-ES) go on this line. State estimated payments go on your state return. Filers who make both sometimes accidentally include state payments on their federal return or federal payments on their state return, which creates mismatches with both taxing authorities. ² [SOURCE: General filing pattern — missed estimated tax payments for freelancers]

Watch out for this

Not making estimated payments at all and then getting hit with an underpayment penalty on line 38. If you expect to owe $1,000 or more in tax after withholding, the IRS requires quarterly estimated payments. The penalty applies even if you pay your full balance at filing time — it is based on when you should have paid, not whether you eventually paid.

Related lines on your return

• Line 25d — Form 1040 — Total withholding; another form of tax payment
• Line 33 — Form 1040 — Total payments; estimated payments are added to withholding and refundable credits
• Line 38 — Form 1040 — Estimated tax penalty; applies if estimated payments were too low or too late