Message Font: Serif | Sans-Serif
No. of Recommendations: 1
RooCat said: BladeXrunner: You missed my point. The poster felt they had already underpaid their estimated
taxes due to the time frame of the sales (i.e 2nd and 3rd quarters). If there is still money due for
the first 3 quarters, using either the annualized or per period method (90%/105%, whichever
applies), the sooner the payment to correct this, the sooner the penalties stop running on the
amount already underpaid.

You're right Roo His tax liability was due on June 15 and Sept 15 and with no withholding there is no way to prevent a penalty. Paying now will stop the 8% simple interest penalty from running longer.

There are some posts on this subject from people who don't really understand the workings of Form 2210 and Schedule AI. The AI gives you credit in every quarter for any safe harbor AMOUNT that is applicable (except the $1,000 underpayment). There is only ONE way to figure it and tax estimators DON'T do it correctly. Quicken's Tax Planner even warns you it can't do it properly if you income varies much. You need a 2210 Calculator to do it correctly and the one on is the only one that does it for ANY tax situation with 1999 rates (for less than $300, that is). Ed
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.