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.

What's New

Use your 2007 tax return as a guide in figuring your 2008 estimated tax, but be sure to consider the following changes. For more information on these changes and other changes that may affect your 2008 estimated tax, see Pub. 553.

Forgiveness of mortgage debt.

A law was just passed that may allow you to exclude from income part or all of the mortgage debt forgiven on your principal residence. This applies for debt forgiven in 2007 through 2009. See Pub. 553 for more details.

Volunteer firefighters and emergency medical responders.

Certain qualified payments and other State and local tax benefits are not included in taxable income.

For more information, see Pub. 553.

Standard deduction.

If you do not itemize your deductions, you can take the 2008 standard deduction listed below for your filing status.