Updated October 17, 2026. Quick answer: Line 38 of Form 1040 is the estimated tax penalty. You may owe it if you did not pay enough tax during the year or if your balance due on line 37 is large compared with your tax. If you choose to figure the penalty yourself you use Form 2210, enter the result on line 38, and add it to the amount on line 37.
IRS worksheets read line by line: W-4 Multiple Jobs Worksheet.
More IRS forms and schedules for individual filers, read line by line: Schedule H instructions.
More IRS forms and schedules, read line by line: Form 1040-V payment voucher.
IRS trust and estate tax forms, read line by line: Form 1041-ES penalty and election.
Business use of your home (Form 8829), the saver’s credit (Form 8880), clean vehicle credits (Form 8936) and amended returns (Form 1040-X), read line by line: Form 1040-X lines 18 to 23.
Related reading on this site: 2026 Estimated Tax Worksheet.
What line 38 asks for
The form’s caption for line 38 reads “Estimated tax penalty (see instructions)”. The instructions open with the conditions: “You may owe this penalty if:” “Line 37 is at least $1,000 and it is more than 10% of the tax shown on your return, or” “You didn’t pay enough estimated tax by any of the due dates.” They add “This is true even if you are due a refund.” For how the payments are scheduled, see the safe harbor page and the Form 1040-ES page.
What the tax shown on your return means
The test above depends on a defined amount: “For most people, the “tax shown on your return” is the amount on your 2025 Form 1040 or 1040-SR, line 24, minus the total of any amounts shown on lines 27a, 28, 29, and 30”. The instructions continue with further items to subtract, among them “Schedule 3, lines 9 and 12”. Line 24 is your total tax, as explained in Form 1040 line by line.
The exception for a prior year return
The instructions give an exception that lets you skip the penalty: “You won’t owe the penalty if your 2024 tax return was for a tax year of 12 full months and either of the following applies.”
The first case is “You had no tax shown on your 2024 return and you were a U.S. citizen or resident for all of 2024.” The second compares your 2025 payments with the tax on your 2024 return. It ends with a condition on timing: “Your estimated tax payments for 2025 must have been made on time and for the required amount.” The instructions then say “If the Exception just described doesn’t apply, see the Instructions for Form 2210 for other situations in which you may be able to lower your penalty by filing Form 2210.”
Where the number comes from
You are not required to calculate it yourself: “If you choose to figure the penalty yourself, use Form 2210”. The form is described on the Form 2210 page. On whether to send it in, the instructions say “Don’t file Form 2210 with your return unless Form 2210 indicates that you must do so.” “Instead, keep it for your records.”
How line 38 changes lines 35a, 36 and 37
The penalty feeds the lines around it. The instructions say “Enter any penalty on line 38. Add the penalty to any tax due and enter the total on line 37.” If you also have a refund, “subtract the penalty from the amount you would otherwise enter on line 35a or line 36.” The check is “Lines 35a, 36, and 38 must equal line 34.”
A labelled illustration, not an IRS example, of that relationship, computed from made up amounts: if line 34 is $700 and the penalty is $50, you might enter $450 on line 35a and $200 on line 36, so $450 plus $200 plus $50 equals $700. The figures are made up to show the arithmetic only.
One more case is covered: “If the penalty is more than the overpayment on line 34, enter -0- on lines 35a and 36.” “Then, subtract line 34 from line 38 and enter the result on line 37.”
Where it goes next
Line 38 flows into the neighbouring lines rather than into a further total. With a balance due, it is included in line 37. With a refund, it reduces what can go on lines 35a and 36. The form moves on to the third party designee and signature sections after it.
Edition and line numbers
This page reads the 2025 Form 1040 and its 2025 instructions, the current files irs.gov served on 2026-10-17. They are the forms for the tax year 2025 return, filed in 2026. The instructions say “The lines on Forms 1040 and 1040-SR are the same.” so everything here applies to Form 1040 and to Form 1040-SR alike. Check the tax year printed on the form you are filling in and use the line numbers on that year’s form, because a different year’s form can number or word its lines differently.
Common mistakes
- Assuming a refund means no penalty. The instructions say the penalty applies “even if you are due a refund”.
- Leaving the penalty out of line 37. The instructions say “Add the penalty to any tax due and enter the total on line 37.”
- Filing Form 2210 by default. The instructions say “Don’t file Form 2210 with your return unless Form 2210 indicates that you must do so.”
Related: Form 2210, safe harbor estimated taxes, Form 1040-ES, and Form 1040 line 37.
Sources
- Instructions for Form 1040 and Form 1040-SR (2025): https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
- Form 1040, U.S. Individual Income Tax Return (2025): https://www.irs.gov/pub/irs-pdf/f1040.pdf
Read from the IRS documents linked above on October 17, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.