Get the free Underpayment of Estimated Payments - The City of Portland, Oregon

MULTNOMAH COUNTY BUSINESS INCOME TAX CITY OF PORTLAND BUSINESS LICENSE TAX Taxable Year / / to / / QU2013 Underpayment of Estimated Payments Portland License Tax Multnomah County Business Income Tax

How to fill out underpayment of estimated payments

How to fill out underpayment of estimated payments:

1. Gather all necessary information: Start by collecting the required documents and information such as your previous year's tax return, Form 2210 (Underpayment of Estimated Tax by Individuals, Estates, and Trusts), and any payment receipts or records.
2. Calculate your total tax liability: Determine the amount of tax you owe for the current year by estimating your income, deductions, and credits. You can use tools like tax calculators or consult a tax professional for assistance.
3. Determine the minimum required payment: Refer to the IRS guidelines to calculate the minimum amount you should have paid as estimated tax throughout the year. Generally, this is the smaller of 90% of your current year's tax liability or 100% of your previous year's tax liability (110% if your adjusted gross income exceeds $150,000).
4. Subtract any tax payments made: Subtract any tax payments you have already made during the year, such as withholdings from wages or quarterly estimated tax payments.
5. Complete Form 2210: Fill out Form 2210 to document your underpayment of estimated tax. This form helps calculate any penalties or interest you may owe.
6. Pay any underpayment penalties: If the calculation on Form 2210 shows that you owe an underpayment penalty, make sure to include this amount in your payment.
7. Make the payment: Finally, submit your payment to the IRS along with Form 2210. Payments can be made electronically or through traditional methods such as checks or money orders.

Who needs underpayment of estimated payments?

1. Self-employed individuals: If you are self-employed and expect to owe $1,000 or more in taxes, you may need to make estimated tax payments throughout the year to avoid underpayment penalties.
2. Individuals with substantial non-wage income: If you receive a significant amount of income from sources other than wages, such as investments or rental properties, you may need to make estimated tax payments to meet your tax obligations.
3. Those with irregular income: If your income fluctuates throughout the year, making estimated tax payments can help ensure you meet your tax obligations as you earn income, rather than facing a large tax bill at the end of the year.

It is important to note that every individual's tax situation is unique, and it is recommended to consult with a tax professional or refer to the IRS guidelines for specific instructions tailored to your circumstances.

For pdfFiller’s FAQs

What is underpayment of estimated payments?

Underpayment of estimated payments occurs when a taxpayer does not pay enough tax throughout the year, either through withholding or by making estimated tax payments.

Who is required to file underpayment of estimated payments?

Taxpayers who expect to owe at least $1,000 in taxes after subtracting their withholding and refundable credits are required to file underpayment of estimated payments.

How to fill out underpayment of estimated payments?

Underpayment of estimated payments can be filled out by using IRS Form 2210. Taxpayers must calculate the amount of underpayment and include this information on the form.

What is the purpose of underpayment of estimated payments?

The purpose of underpayment of estimated payments is to ensure that taxpayers are paying a sufficient amount of tax throughout the year to avoid penalties for underpayment.

What information must be reported on underpayment of estimated payments?

Taxpayers must report their total tax liability, total tax payments made, estimated tax payments made, and any other applicable credits on the underpayment of estimated payments form.

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