Instructions for Form 2220 |
2003 Tax Year |
General Instructions
This is archived information that pertains only to the 2003 Tax Year. If you are looking for information for the current tax year, go to the Tax Prep Help Area.
Corporations (including S corporations), tax-exempt organizations subject to the unrelated business income tax (tax-exempt
organizations), and
private foundations use Form 2220 to determine:
- Whether they are subject to the penalty for underpayment of estimated tax and, if so,
- The amount of the underpayment penalty.
Generally, the corporation does not have to file this form with its income tax return because the IRS will figure the amount
of any penalty and
notify the corporation of any amount due. However, even if the corporation does not owe a penalty, complete and attach this
form to the corporation's
tax return if:
- The adjusted seasonal installment method is used,
- The annualized income installment method is used, or
- The corporation is a large corporation (as defined in the instructions for Part I, line 3, on page 2) figuring its first required
installment based on the prior year's tax.
Who Must Pay the Underpayment Penalty
Generally, a corporation is subject to the penalty if the tax shown on its 2003 return is $500 or more and it did not timely
pay at least the
smaller of:
- The tax shown on its 2003 return or
- The tax shown on its 2002 return (if it filed a 2002 return showing at least some amount of tax and the return was for a full
12 months).
However, a large corporation may base only its first required installment on the prior year's tax.
Note:
In these instructions, “return” generally refers to the corporation's original return. However, an amended return is considered the original
return if the amended return is filed by the due date (including extensions) of the original return.
The penalty is figured separately for each installment due date. Therefore, the corporation may owe a penalty for an earlier
due date even if it
paid enough tax later to make up the underpayment. This is true even if the corporation is due a refund when its return is
filed. However, the
corporation may be able to reduce or eliminate the penalty by using the annualized income installment method or the adjusted
seasonal installment
method. See the Part I instructions for details.
- Check one or more boxes in Part I if the corporation uses the adjusted seasonal installment method, the annualized income
installment
method, or if the corporation is a large corporation.
If the corporation checked a box in Part I, attach Form 2220 to the income tax return. Be sure to check the box on line 33,
page 1, of Form 1120;
line 29 of Form 1120-A; or the comparable line of any other income tax return the corporation is required to file (e.g., Form
990-C, 1120-L, 1120S,
etc.).
- Complete Part II to determine the underpayment for any of the installment due dates.
- If there is an underpayment on line 17, Part II (column (a), (b), (c), (d) or (e)), go to Part III to figure the penalty.
- Complete Schedule A if the corporation uses the adjusted seasonal installment method and/or the annualized income installment
method.
Prev | First | Next Instructions Index | 2003 Tax Help Archives | Tax Help Archives | Home
|