I had an uncommon income item on my taxes so now my estimated tax payments are very high for 2025. Can I have these payments adjusted to my normal income for 2025?

[DEBSGONECOASTAL]

This was a one time payment that I received in 2024. How do I have the 2025 payment amounts adjusted to be based on my normal annual income instead of being based on the one time payment from 2024?

[LindaS5247]

You can use Form 1040-ES to calculate your estimated taxes. Form 1040-ES   

There is a worksheet to calculate your estimated taxes.

The IRS has a calculator for determining withholdings: Tax Withholding Estimator
 

You can also calculate your 2025 estimated taxes and generate payment vouchers by doing this:

1. Open or continue your return.
2. Navigate to the 1040-ES section:
   • TurboTax Online/Mobile: Go to 1040-ES.
   • TurboTax Desktop: Search for 1040-es by typing "1040-es" in your search bar and click on the link "Jump to 1040-es" (be sure to include the dash) 
3. Answer No to the question "Do you want to change your W-4 withholdings for 2025?"
4. Answer questions about your 2025 filing status, income, and deductions.
5. Eventually, you'll come to the "Print Vouchers?" screen. 
6. Answer Yes and TurboTax will include your 2025 1040-ES payment vouchers when you print a copy of your return later.

Click here for Can TurboTax calculate next year's federal estimated taxes?

Click here for "How Do I Make Estimated taxes"

Click here for additional information on "How to Determine What to Pay and When"

Click here for common questions on Estimated taxes.

[DEBSGONECOASTAL]

Thank you.  Just to clarify, so I am not required to pay the amounts that are automatically generated with my 2024 taxes? And by following the instructions you gave above those calculations will override the autogenerated estimated payments for 2025?

[JohnB5677 · Accepted solution]

You are correct on both counts.  

• @LindaS5247 gave excellent guidance, and no you do not have to pay the amount on the vouchers.  
• However, if you don't you run the risk of paying an underpayment fee.

You can make payments on the IRS Payment options website

The underpayment penalty will be assessed if any of these apply:

• "If you don’t pay enough tax through withholding and estimated tax payments, you may have to pay a penalty."
• "You also may have to pay a penalty if your estimated tax payments are late, even if you are due a refund when you file your tax return."

To avoid the under payment penalty:

• The amount you owe is less than $1,000, after subtracting withholding and refundable credits.
• You paid 90% of the tax that you owed for the current year.
• You paid 100% of the previous year tax, (110% for higher incomes).
• If your previous year's adjusted gross income was more than $150,000 you will have to pay in 110% of your previous year's taxes to satisfy the "safe-harbor" requirement.

"Typically, underpayment penalties are 5% of the underpaid amount, and they're capped at 25%. 

Underpaid taxes also accrue interest at a rate that the IRS sets annually."

To avoid this situation it is recommended that you adjust your W-4 with your employer or pay estimated taxes.

Underpayment of Estimated Tax by Individuals Penalty