Estimated tax Underpayment Penalties

[Unregistered]

Can the annualized income be used to calculate the estimated taxes for the first three quarters and then use the previous tax year at 110% be used for the final quarter to determine the penalty forgiveness for underpayment of estimated payments, or must either one or the other be used. Therefore, requiring a full payment if the expected tax liability increases way beyond the 110% for the final quarter?

[Bees Knees]

The annualized income method on the page 4 of the 2210 calculates the required installment for any quarter as the lesser of 90% (or 110%) of the actual annualized income for that quarter or the annualized income based on the previous year for that quarter. So when you fill out that worksheet, I think you will find that it is already going back and forth between the lesser of the two installments for any particular quarter.