Instructions For Form Ct-222 - Underpayment Of Estimated Tax By A Corporation - New York State Department Of Taxation And Finance - 2004
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1
2New York State Department of Taxation and Finance
CT-222-I
Instructions for Form CT-222
Underpayment of Estimated Tax by a Corporation
Temporary increase in the mandatory first installment of
The second, third, and fourth installments of estimated franchise
tax and MTA surcharge are due on the fifteenth day of the sixth,
estimated tax
ninth, and twelfth months of your tax year.
For tax years beginning on or after January 1, 2003, and before
January 1, 2006, the Tax Law has been amended to provide an
Computation of underpayment
increase in the mandatory first installment from 25% of the
Complete lines 1 through 12 to determine any underpayment of
preceding year’s tax to 30%. This increase is for general business
estimated taxes.
corporations (Article 9-A), banking corporations (Article 32),
insurance corporations (Article 33), and entities subject to tax
Line 2 — Large corporations: Multiply the amount on line 1 by
under Article 9, sections 184, 186-a, or 186-e, whose preceding
100%. All others: Multiply line 1 by 91%. A large corporation is one
year’s tax, exclusive of the metropolitan transportation business tax
that had, or whose predecessor had, allocated entire net income
(MTA surcharge), exceeds $100,000. Taxpayers subject to the MTA
(ENI) of at least $1,000,000 for any of the three tax years
surcharge that are required to pay their first installment at the 30%
immediately preceding the tax year involved. Article 33 filers: For
rate must also calculate their estimated tax for the surcharge at
a nonlife insurance corporation subject to tax under Tax Law
30% of the preceding year’s MTA surcharge.
section 1502-a, a large corporation is one that had allocated ENI of
at least $1,000,000 for any of the three tax years immediately
Estimated tax payments required by partnerships,
preceding the tax year involved or had direct premiums, subject to
limited liability companies (LLCs), and New York
the premiums tax under Tax Law section 1502-a, exceeding
S corporations
$3,750,000 for any of the three preceding tax years beginning on
For tax years ending after December 31, 2002, all partnerships,
or after January 1, 2003.
LLCs that are treated as partnerships for federal purposes, or
Line 4 — See Payment of estimated tax above.
New York S corporations that had income from New York sources
are required to pay estimated taxes on behalf of nonresident
Line 8 — Corporate partners: Include amounts paid on time and
individuals and C corporation partners, members, or shareholders
on your behalf by a partnership. A payment of estimated tax is
on their distributive or pro rata share of the respective entities
applied against underpayments of required installments in the
income. See Form IT-2659, Estimated Tax Penalties for
order in which the installments are required to be paid.
Partnerships and New York S Corporations , to determine if you
Example: Calendar-year taxpayer
underpaid estimated tax and, if so, to compute the penalty due.
First
Second
Third
Fourth
Due date ...........................
3/15
6/15
9/15
12/15
General information
25% of prior year tax
or MTA surcharge ...........
1,500
--
--
--
All general business corporations (including S corporations),
Installment amount due ....
--
1,000
1,000
1,000
banking, insurance, utilities (including providers of
Paid on time/credited ........
1,500
0
500*
1,000 **
telecommunication services), and transportation and transmission
Underpayment ..................
0
1,000
500
0
corporations whose franchise tax for the current tax year can
Penalty is due on $1,000 from 6/15 to 9/15.
Penalty is due on $500 from 9/15 to 12/15.
reasonably be expected to be more than $1,000 after credits must
* Paid $1,500, $1,000 applied to 6/15 installment; $500 applied to 9/15 installment.
file a declaration of estimated franchise tax and make quarterly
** Paid $1,500, $500 applied to 9/15 installment; $1,000 applied to 12/15 installment.
installment payments.
Any corporation doing business in the Metropolitan Commuter
Exceptions to the underpayment penalty
Transportation District (MCTD) that is required to make a
You will not have to pay a penalty if you made all tax payments on
declaration of estimated franchise tax must also make a declaration
time and they equal or exceed the amount that would have been
of estimated MTA surcharge and make quarterly installment
required to be paid by each installment date if the estimated tax
payments.
were an amount determined under any of the exceptions listed
If you do not pay the required amounts on time, you may have to
below.
pay an underpayment penalty for the period of underpayment.
A different exception may be applied to each underpayment. If no
exception applies, complete lines 18 through 39 to determine the
Payment of estimated tax
amount of the penalty.
First installment — If the franchise tax on your previous year’s return
or on your request for extension of time for filing that return is more
Exceptions 1 and 2, on lines 14 and 15, do not apply to large
than $1,000 and does not exceed $100,000, you must pay 25% of
corporations.
the tax with the return or extension. If the franchise tax on your
Line 14, exception 1 (not to be used by large corporations): Allows
previous year’s return or on your request for extension of time for
you to substitute for the current year’s estimated tax the tax
filing that return exceeds $100,000, you must pay 30% of the tax with
reported on your 2003 return. You must have filed a franchise tax
the return or extension. If you are subject to tax under Tax Law
return showing a tax liability for the preceding tax year, and that
section 1510(b)(1), and the tax exceeds $1,000, the percentage
year must have consisted of 12 months.
is 40%.
Line 15, exception 2 (not to be used by large corporations):
If you are liable for the MTA surcharge, a 25% first installment is
Applies if the amount you paid is equal to or more than the tax
required if your franchise tax is more than $1,000 and does not
computed by using the current year’s rate but based on the facts
exceed $100,000. If your franchise tax exceeds $100,000, a 30%
shown on the prior year’s return and the law that applies to the
first installment is required. If you are subject to tax under Tax Law
prior year.
section 1510(b)(1), and the tax exceeds $1,000, the percentage
is 40%.
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