[005]

Hi everyone, I hope the studying is going well.

Just a quick question, can you please tell me if I have this down right:

For individual taxpayers, for estimated tax payments, the required annual amount is the lower of:

1. 90% of tax on current year return; or

2. 100% of tax on prior year return (if income is 150k or less) and 110% of prior year return amount if income is over 150k

and for corp’s: they must make over 500 in income and then the payments must be the lessor of:

1. 100% of tax liability for current year; or

2. 100% tax liability of preceding year

---

I just wanted to make sure I am getting the distinction right. Also, will the $1,000-owed requirement be tested for individuals?

I appreciate the help, study hard everyone! and good luck

BEC - ✔
REG - ✔
AUD - ✔
FAR - 11/29/14

CPAExcel, Ninja MCQs, and a sh*t ton of coffee

[h0wdyus]

Estimated payment must be made by every corp whose estimated TAX is expected to be $500 or more ( not the income as you mentioned in your post ).

the 100% you mentioned is correct.

A corp with $1 million or more of taxable income in any of its 3 preceding tax years ( large Corps ) can use its preceding year's tax only for its first installment and must base its estimated payment on 100% of its current year's tax on to avoid penalty

FAR - 81 29th Aug 2013
AUD - 84
REG - 82
BEC - 89 29th Aug 2014
Using Yager

FROM NJ

[h0wdyus]

Estimated payment must be made by every corp whose estimated TAX is expected to be $500 or more ( not the income as you mentioned in your post ).

the 100% you mentioned is correct.

A corp with $1 million or more of taxable income in any of its 3 preceding tax years ( large Corps ) can use its preceding year's tax only for its first installment and must base its estimated payment on 100% of its current year's tax on to avoid penalty

FAR - 81 29th Aug 2013
AUD - 84
REG - 82
BEC - 89 29th Aug 2014
Using Yager

FROM NJ

[Vlakmir]

Hello~

People who have taken the exam are not allowed to disclosed what showed up on their exam to other people.

If it is in your study materials, as far as anyone can tell (the professionals making the study materials for this exam for a living) thinks it may show up on the exam.

Nature of the beast.

By the way, if the corporations are using the prior year method, they can only use that for the first payment, but then the payments must annualized based of projected icome for the last 3 payments, with the 2nd payment being a catch-up.

For example,

If the Corp's prior year taxes amounted to $100, they could make a $25 first payment. After that, their payments are based on their projected annualized income. If their projected income was $200, they would have to pay $75 in the 2nd, and $50 in the 3rd/4th payment.

The second payment is $75 because they must “catch up” their first payment (of 25, which is 25 less than 50, which is 200/4 equal payments), and then they pay what they would pay evenly for the lat 2 quarters.

I'm not sure if this would show up on the test – but it was in my tax course, and I figured they very well could ask what a corporations estimated payments should be.

REG - 92
AUD - 90
BEC - 82
FAR - 82
BISK Review Materials
DONE! /Happydance

[Vlakmir]

Hello~

People who have taken the exam are not allowed to disclosed what showed up on their exam to other people.

If it is in your study materials, as far as anyone can tell (the professionals making the study materials for this exam for a living) thinks it may show up on the exam.

Nature of the beast.

By the way, if the corporations are using the prior year method, they can only use that for the first payment, but then the payments must annualized based of projected icome for the last 3 payments, with the 2nd payment being a catch-up.

For example,

If the Corp's prior year taxes amounted to $100, they could make a $25 first payment. After that, their payments are based on their projected annualized income. If their projected income was $200, they would have to pay $75 in the 2nd, and $50 in the 3rd/4th payment.

The second payment is $75 because they must “catch up” their first payment (of 25, which is 25 less than 50, which is 200/4 equal payments), and then they pay what they would pay evenly for the lat 2 quarters.

I'm not sure if this would show up on the test – but it was in my tax course, and I figured they very well could ask what a corporations estimated payments should be.

REG - 92
AUD - 90
BEC - 82
FAR - 82
BISK Review Materials
DONE! /Happydance

[005]

awesome, thank you!!

BEC - ✔
REG - ✔
AUD - ✔
FAR - 11/29/14

CPAExcel, Ninja MCQs, and a sh*t ton of coffee

[005]

awesome, thank you!!

BEC - ✔
REG - ✔
AUD - ✔
FAR - 11/29/14

CPAExcel, Ninja MCQs, and a sh*t ton of coffee

[Author]

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