Perfect - that's what you need to pay for ES! (sounds like you don't have withholding in the mix). If you didn't pay in Q1 then pay 2 x that = $2072 in Q2 (by 6/16) and you will have a little penalty on the missed $1036 from Q1 for a few months probably about $20. (Personally I like to round up ES to whole 50/100s). Then put the remaining $33k you owe aside in a T-bill or something and earn 4% on it til April '26...
In your original 2024 return in Forms mode go to Est Tax Options to see the calculation (not sure why it's 1036 if your tax was 3955 but check this form to see why). If you didn't input 2025 estimate in Other Tax Situations / Form W4 and Estimated Tax that won't show up in the safe harbor calculation but that's ok as you know it will be 37k and 90% of that will be way larger than 100% of your 2024 tax.
Back to your experiment version for 2025 in TT "2024"... you can validate these ES payments will work for you...
- In Other Tax Situations / Underpayment Penalty, update the "2023" AGI/tax information to be your 2024 figures ($4k), depending how you set up the return if you carried over a return or started from scratch but either way you need to get your 2024 info in there as "2023" for the correct penalty calculations.
- If you don't input any ES payments, you should see a penalty on Form 1040 line 38. In Forms mode, double click line 38 then double click again in the worksheet to show the Form 2210 calculations which don't normally show up in forms mode for some reason. In Lines 1-9, this should show that your "2023" (=2024) tax was $4k, your "2024" (=2025) tax was $37k and do this safe harbor calculation that you should have paid ES only for $4k and calculate a penalty on that, I would guess about $160 without ES payments.
- Now input your projected 2025 ES payments in Deductions & Credits / Estimated Tax and Other Taxes Paid (using 2024 dates). You should see that the penalty on line 38 goes down I think to about $20, if you set up without a Q1 payment and 50% in Q2. Play round with the ES - input higher ES amounts and you should see that paying more ES has no effect on the penalty.
- Again in your experiment version, ignore the "2025" ES vouchers generated. Keep thinking 1 year ahead - these represent what TT will do by default next year for your 2026 ES payments, it will calculate 110% of prior year tax until you input your 2026 income information (and you can do this too - go to Other Tax Situations / Form W4 and Estimated Payments, where it asks for "2025" income information put in some estimates for 2026, and you should see the ES vouchers reset to 90% of that).
Not a CPA but I think you are in good shape following the original ES voucher amounts from your original filing, you are always "safe" if you pay ES based on prior year tax, often it can be an overpayment but this is one of those times when it works to your advantage (you could win the lottery next week and still only owe $4k in ES til April 2026). Good use of TT to run your estimate for 2025 and recommend using that to satisfy yourself that these ES payments will minimize your penalty.
