How do you know if you need estimated tax forms to pay tax for 2009?

Answer 1

Form 1040-ES is Estimated Tax for Individuals. Generally, you must make estimated tax payments if you expect to owe, after subtracting any withholding and credits, at least $1,000 in tax for 2009. In addition, you expect your withholding and credits to be less than 90 percent of the tax that'll be due on your 2009 tax return OR 100 percent of the tax that was due on your 2008 tax return, whichever is smaller. An exception is that if you didn't have a tax liability (i.e., your total tax was 0 or you didn't have to file a return) for 2008, then you don't have to pay estimated taxes for 2009.

Also, other alternatives to estimated tax payments may apply. One, if you also receive wages/salaries, you could file a new Form W-4 (Employee's Withholding Allowance Certificate) to increase the amount of tax taken out of your earnings. If you're receiving a pension or annuity, you can complete Form W-4P (Withholding Certificate for Pension or Annuity Payments) to start or change withholding.