The chemical transformations of formamide (NH(2)CHO), a molecule of prebiotic interest as a precursor for biomolecules, are investigated using methods of electronic structure computations and Rice-Rampserger-Kassel-Marcus (RRKM) theory. Specifically, quantum chemical calculations applying the coupled-cluster theory CCSD(T), whose energies are extrapolated to the complete basis set limit (CBS), are carried out to construct the [CH(3)NO] potential energy surface. RRKM theory is then used to systematically examine decomposition channels leading to the formation of small molecules including CO, NH(3), H(2)O, HCN, HNC, H(2), HNCO, and HOCN. The energy barriers for the decarboxylation, dehydrogenation, and dehydration processes are found to be in the range of 73-78 kcal/mol. H(2) loss is predicted to be a one-step process although a two-step process is competitive. CO elimination is found to prefer a two-step pathway involving the carbene isomer NH(2)CHO (aminohydroxymethylene) as an intermediate. This CO-elimination channel is also favored over the one-step H(2) loss, in agreement with experiment. The H(2)O loss is a multistep process passing through a formimic acid conformer, which subsequently undergoes a rate-limiting dehydration. The dehydration appears to be particularly favored in the low-temperature regime. The new feature identifies aminohydroxymethylene as a transient but crucial intermediate in the decarboxylation of formamide.