Form 1041-ES: Estimated Tax Payments, Due Dates, and Penalties

Form 1041-ES is the IRS voucher fiduciaries use to make quarterly estimated federal income tax payments for an estate or trust. You generally have to file and pay if the entity expects to owe at least $1,000 in tax for 2026 after withholding and credits, and your withholding and credits won’t cover the required annual payment.¹ Payments run on the same April, June, September, and January calendar that individuals use, and the penalty for missing them compounds daily.

Who Has to Pay

Two conditions have to both be true. The estate or trust expects to owe $1,000 or more in tax for the year after subtracting withholding and credits, and those withholding amounts and credits are expected to fall below the “required annual payment” described below.¹ Miss either condition and no estimated payments are due.

Complex trusts that retain income at the entity level are the typical filers. A simple trust distributes all its income each year and passes the tax liability out to beneficiaries, so it usually won’t owe enough at the entity level to trigger the requirement. But the classification is a tax label, not a comment on complexity: if the trust retains any income or has undistributed capital gains, it’s taxed as a complex trust on those amounts.

Grantor trusts don’t file 1041-ES at all. The IRS treats the grantor as the owner for income tax purposes, so the grantor reports the income and pays estimates through Form 1040-ES instead.

The Two-Year Grace Period for Estates

A domestic decedent’s estate is exempt from estimated tax payments for any tax year ending within two years of the date of death. The same exemption reaches a trust that was fully owned by the decedent as a grantor trust during their lifetime, if the residue of the estate passes to that trust under the will, or (if there’s no will) if the trust is primarily responsible for the estate’s debts and expenses.² Once the two years close, the standard $1,000 threshold applies going forward.

How Much to Pay: The Required Annual Payment

The total estimated tax for the year is the “required annual payment,” and it’s the smaller of two calculations:¹

90% of the tax the estate or trust will owe on its 2026 Form 1041, or
100% of the tax shown on the 2025 return.

You only need to meet the lower of the two. The prior-year figure is the true safe harbor because it’s a known number, not a projection. If the entity’s adjusted gross income on the 2025 return exceeded $150,000, that safe harbor rises to 110% of the prior year’s tax.¹

Divide the required annual payment by four for equal quarterly installments, or use the annualized method described further down if the entity’s income arrives unevenly.

Why the Number Is Often Larger Than Expected

Estates and trusts hit the top federal bracket at $16,000 of taxable income for 2026. The rates step from 10% up to 37% across four narrow bands, with the 37% rate starting above $16,000. An individual doesn’t reach 37% until well over $600,000 of taxable income. Even modest retained income produces a real tax bill.

On top of that, entities with net investment income face the 3.8% Net Investment Income Tax once adjusted gross income clears the dollar amount where the top bracket begins — $16,000 for 2026.³ The NIIT applies to the lesser of undistributed net investment income or the amount by which AGI exceeds that threshold.¹ Factor it into any current-year projection.

When you project income, include interest, dividends, rents, business income, and any capital gains the fiduciary retains rather than distributes. The distribution deduction is the main lever for managing the tax: the more income the entity distributes, the less it owes, since beneficiaries are usually in lower brackets. Personal exemption amounts are fixed by statute at $600 for an estate, $300 for a simple trust, and $100 for a complex trust.⁴ The worksheet in the 1041-ES package walks through the arithmetic.

When Payments Are Due

Most trusts must use a calendar year.⁵ For calendar-year entities, the 2026 installments are due:¹

April 15, 2026
June 15, 2026
September 15, 2026
January 15, 2027

If a date falls on a weekend or federal holiday, it slides to the next business day.

Estates can elect a fiscal year, and tax-exempt trusts such as charitable remainder trusts also qualify for a fiscal year.⁵ Fiscal-year filers pay on the 15th day of the 4th, 6th, and 9th months of the fiscal year, and the 1st month of the following fiscal year. Estates within the two-year post-death exemption skip these deadlines entirely.

How to Submit the Payment

For 2026, all mailed 1041-ES vouchers go to a single address:¹

Internal Revenue Service
P.O. Box 932400
Louisville, KY 40293-2400

This isn’t the address where the Form 1041 return itself is filed. Only the U.S. Postal Service can deliver to this P.O. Box; private carriers like FedEx or UPS can’t. Send a check or money order payable to “United States Treasury” with the completed voucher. Each voucher needs the legal name of the estate or trust, the fiduciary’s name and title, the entity’s Employer Identification Number, and the payment amount. First-time filers use the blank vouchers in the package; the IRS typically sends preprinted vouchers in later years.

The Electronic Federal Tax Payment System is the primary electronic route. EFTPS enrollment can take up to five business days, so start early if a deadline is close.⁶ If the 2025 return produced an overpayment and you elected to credit it forward, subtract that amount when calculating what the first installment still owes.

When Income Isn’t Steady

Equal quarterly installments assume steady income. That’s often wrong for an estate or trust that might receive a large capital gain in November or a lump-sum retirement distribution in the third quarter. The annualized income installment method recalculates the required payment for each quarter based on income actually received to that point. The applicable percentages are 22.5%, 45%, 67.5%, and 90% of the annualized tax for the first through fourth installments.² Any reduction in an early installment is recaptured later, so the total doesn’t drop — you just avoid a penalty for not paying tax before the income arrived.

Allocating Payments to Beneficiaries

A fiduciary can elect to treat some or all of a trust’s estimated tax payments as if a beneficiary made them, using Form 1041-T. The beneficiaries then claim credit for those payments on their personal returns.⁷ The election must be made by the 65th day after the close of the tax year — roughly early March for a calendar-year trust.⁸ Allocated amounts are treated as paid by the beneficiary on January 15 following the tax year, which puts them in the fourth quarter of the beneficiary’s own estimated tax picture.

Estates can only make this election in what is reasonably expected to be the estate’s final tax year.⁸ If administration is going to continue another year, the fiduciary can’t allocate payments to beneficiaries yet. When the entity does terminate, any excess estimated payments left after settling the final liability flow to the beneficiaries through the final Schedule K-1.

The Underpayment Penalty

Missing an installment triggers a penalty based on the shortfall, how long it went unpaid, and the underpayment interest rate published each quarter.² The rate for the first quarter of 2026 is 7%, compounded daily.⁹ It’s set at the federal short-term rate plus three percentage points and can change each quarter.

The penalty runs from the missed installment’s due date until the earlier of the payment date or the 15th day of the 4th month after the close of the tax year. You usually don’t calculate it yourself; the IRS will figure it and bill you. File Form 2210 only to request a waiver or to reduce the penalty using the annualized income method.¹⁰

The IRS will waive all or part of the penalty when the underpayment was caused by a casualty, disaster, or other unusual circumstance where the penalty would be unfair. A waiver is also available if the fiduciary retired after age 62 or became disabled during the relevant period and the underpayment was due to reasonable cause.¹¹ Attach Form 2210 and a written explanation to the return.

State Rules Are Separate

Federal estimated tax is only part of the picture. Most states with an income tax impose their own estimated tax rules on estates and trusts, and the minimum liability thresholds vary. Some states trigger at $500, others match the federal $1,000, and a few states have no income tax. Check the rules for the state where the trust is administered or the estate is being probated, since deadlines and thresholds don’t always mirror the federal ones.

1
Internal Revenue Service. Form 1041-ES – Estimated Income Tax for Estates and Trusts
2
Office of the Law Revision Counsel. 26 USC 6654 – Failure by Individual To Pay Estimated Income Tax
3
Office of the Law Revision Counsel. 26 USC 1411 – Imposition of Tax
4
Office of the Law Revision Counsel. 26 USC 642 – Special Rules for Credits and Deductions
5
GovInfo. 26 USC 644 – Taxable Year of Trusts
6
Internal Revenue Service. EFTPS: The Electronic Federal Tax Payment System
7
Internal Revenue Service. Form 1041-T – Allocation of Estimated Tax Payments to Beneficiaries
8
Office of the Law Revision Counsel. 26 USC 643 – Definitions Applicable to Subparts A, B, C, and D
9
Internal Revenue Service. Interest Rates Remain the Same for the First Quarter of 2026
10
Internal Revenue Service. Instructions for Form 2210
11
Internal Revenue Service. Instructions for Form 2210