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    Estimated Tax Penalty

    In 2012 TP had 92% of TP's Fed tax liability w/h via TP's W-2. In 2013, TP had 35% of Fed tax liability w/h thru TP's W-2 & 1099-R's (premature distribution). Within my Pro Series software, I opened up form 2210 and all TP's data auto flowed thus determining NO tax penalty therefore no form 2210 needed to be filed. Something does not seem correct?

    #2
    Was the total withholding for 2013 equal to or greater than the total tax liability on the 2012 return? (in some cases this might need to be 110%) If the taxpayer met that safe harbor test, then there is no Est Tax Penalty, regardless of the amount underwithheld for 2013.
    "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

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      #3
      Form 2210 not needed

      As JohnH stated, it is quite probable the client met Exception 1 aka the "safe harbor" rule.

      All that is needed there is (in most cases) to have paid, and on a timely basis, more than the prior year's (2012) income tax liability. (Perhaps 110% for higher income?) In any case, the fact that this year the client only paid in a much smaller per cent of his 2013 income liability is to a certain degree a non-issue. You can get a "pardon" from any underpayment if those circumstances fit. Of course, for 2014 taxes the bar will obviously be set higher. . .

      If your software has access to the 2012 data file, it sounds as if everything is working perfectly.

      You may wish to review the general rules for Form 2210 filing ??

      FE

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        #4
        Estimated Tax Penalty

        Was 2013 withholding equal to tax due in 2012? If so then zero is correct.

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