Two very wealthy spouses separate and leave a massive tax liability from 2010.
The liability from 2010 is over $1MM and they intend on filing MFS returns. The MFS high rate won't matter (believe it or not) since both of their incomes are so high that the lowest tax brackets are washed out whether MFJ or MFS. The two parties have paid in their own separate and unequal estimated payments for 2011.
The $1MM tax liability from 2010 translates into an estimated tax requirement of 110% of that amount for 2011. For purposes of underestimated tax penalty, how is the $1MM tax liability from 2010 allocated?
1) 50-50?
2) In proportion to their separate income items?
3) Another calculation?
The liability from 2010 is over $1MM and they intend on filing MFS returns. The MFS high rate won't matter (believe it or not) since both of their incomes are so high that the lowest tax brackets are washed out whether MFJ or MFS. The two parties have paid in their own separate and unequal estimated payments for 2011.
The $1MM tax liability from 2010 translates into an estimated tax requirement of 110% of that amount for 2011. For purposes of underestimated tax penalty, how is the $1MM tax liability from 2010 allocated?
1) 50-50?
2) In proportion to their separate income items?
3) Another calculation?
Comment