The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: Two Related Tax Issues||Date: 8/18/2013 1:50 PM|
|Author: Opv1419||Number: 119027 of 120479|
Might I add one additional follow-up question, just to make sure I've got my thinking straight. The IRS instructions state that a tax payer can generally avoid paying a penalty if he:
1. Owes less than $1,000 after all withholding and credits;
2. Pays at least 90% of the current taxes due; or,
3. Pays at least 100% of the taxes due for the prior year, "whichever is smaller."
I initially presumed that "whichever is smaller" applies only to #s 2 and 3. I have grown less confident in that conclusion the more I think about it. Since the penalty is ostensibly avoided if any of the above criteria is met, does the phrase apply only to all three provisions or to just the last two?
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