|
Posted by nomail1983@hotmail.com on June 19, 2007, 9:29 pm
Please log in for more thread options
>> Does the Calif estimated tax penalty apply even if you are
>> due a refund, as does the federal estimated tax penalty?
> [....]
> Look at the bottom right-hand corner of page 18 of the Form
> 540 instructions. There is no penalty for underpayment of
> estimated taxes if the total of your payments and credits
> equals at least 90% of your current year liability, or 100%
> (or 110% if high income) of your prior year tax liability,
> or is less than $200.
Thanks, but that does not address my question.
For federal taxes, you might still be subject to the
underpayment penalty if you did not meet the proper
conditions on each of the due dates for estimated tax
payments ("quarterly"). For example, if you make no tax
payments during the year, but pay more than 100% of your
total tax liability in December, resulting in a refund, you
are likely subject to an underpayment penalty -- unless all
of your income were in the last quarter, or you made that
more-than-100% tax payment by withholding from earned
income, ya-da-ya-da-ya-da.
But according to Calif income tax instructions, it would
appear that is not the case. The instructions clearly state
that if the "tax due" line is zero: "Stop. You are not
subject to an estimated payment penalty".
I now know that those instructions are wrong! Even though I
got a refund, I got a notice from the FTB stating that the
refund was reduced by an underpayment penalty (amount
stated).
(And no, I did not make just one tax payment in December.
That was just an extreme hypothetical to make the point.)
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
| 
Yahoo! 
Google 
Windows Live 
del.icio.us 
digg 
Netscape 
XML Sitemap