Form 2210 Calculator : Find if you owe estimated tax penalty ?

How to Know If You need to pay penalty for underpayment of estimated tax ?

underpayment of estimated taxInternal Revenue Code §6654 provides law for imposition of penalty for the failure to pay proper estimated tax by a taxpayer. You can use the form 2210 to see if the Estimated tax payments are  required, if you are liable to at least $1,000 in tax after subtracting withholding and refundable credits for a tax year . But before you compute the penalty , you need to determine  if you have  indeed paid the estimated tax lower than required .  The calculator below tell you exactly if you need to pay penalty . I have already published an article 7 faqs on penalty for underpayment of estimated tax

Calculator for Form 2210 :Do You Owe Penalty

 

Important Points to Note 

There are special rules for farmers and fishermen, certain household employers and certain higher income taxpayers. For more information, refer to Publication 505Tax Withholding and Estimated Tax. You can see the  Form 2210.pdfUnderpayment of Estimated Tax by Individuals, Estates, and Trusts, to examine if you owe a penalty for underpaying your estimated tax.

The law allows IRS to waive the penalty if:

  1. The reason for default of  payment of estimated tax was on account of of a casualty event, disaster, or other unusual circumstance and or
  2. You retired (after reaching age 62) or became disabled during the tax year or in the preceding tax year for which you should have made estimated payments, and the underpayment was due to reasonable cause and not willful neglect.
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