<< Can someone help. I have never payed estimated taxes, the quarterly payment. I always avoided penalties and interest because I always paid at least 110% of prior years liability. Chalk it up to the good times. This year, due to deferred compenstaion and unusual capital gains due to the stock market, I will have underpaid my 99 liability by a substantial amount.Is this grounds for penalty? I did not intend to take profits in the market, and did so late in the year, so I could not have forseen that event. Nor was I familiar with a new policy of deferred comp at work. >>I'm a little confused here, but I'm guessing that because of the deferred compensation, your 1999 withholding did not reach 100% of your 1998 tax (105% if your 1999 AGI was $150,000). If I'm wrong here, you have nothing to worry about, because you meet the safe harbor from the penalty.Assuming I'm right, you may want to look into the annualized income calculations on Form 2210 since you had unusual gains late in the year. It can reduce, if not eliminate, the penalty.Phil MartiTax Preparer
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