Form 2220-K - Underpayment And Late Payment Of Estimated Income Tax And Llet

2220-K

Page 3

41A720-S6 (10-11)

INSTRUCTIONS FOR FORM 2220-K

Commonwealth of Kentucky

DEPARTMENT OF REVENUE

Purpose of Form—This form is used by a corporation

Line 1—Enter the LLET liability in Column (a), income tax

or limited liability pass-through entity required by KRS

liability in Column (b) and the combined tax liability in

141.042 and KRS 141.044 to file a declaration of estimated

Column (c) as follows:

tax to: (i) compute the underpayment penalty as provided

by KRS 131.180(3) and KRS 141.990; and (ii) compute

Enter on Line 1, Column (a) the 2011 LLET liability from

the interest on any late payment or underpayment of an

Form 720, Part I, Line 6 or from Form 720S, 725 or 765,

estimated tax installment as provided by KRS 141.985.

Part II, Line 6; and enter on Line 1, Column (b) the 2011

income tax liability from Form 720, Part II, Line 8 or from

PART I—EXCEPTION

Form 720S, Part III, Line 4. Also enter the total of Line 1,

Columns (a) and (b) on Line 1, Column (c).

KRS 141.990(3) provides that a penalty shall not apply

if the estimated tax payments made by a corporation

If the combined tax liability imposed by KRS 141.040 and

or limited liability pass-through entity are equal to the

141.0401 for the prior tax year was equal to or less than

income tax due under KRS 141.040 for the previous taxable

$25,000 and the prior year’s combined tax liability is less

year, and the income tax due under KRS 141.040 for the

than the current year’s combined tax liability, enter on

previous year was equal to or less than $25,000. If the

Line 1, Column (a) the 2010 LLET liability from Form 720,

corporation or limited liability pass-through entity meets

Part I, Line 6 or from Form 720S, 725 or 765, Part II, Line

this exception, check the box and complete Lines 1 and 2

6; and enter on Line 1, Column (b) the 2010 income tax

showing the prior year income tax liability and the current

liability from Form 720, Part II, Line 8 or from Form 720S,

year estimated tax payments.

Part III, Line 4. Also enter the total of Line 1, Columns (a)

and (b) on Line 1, Column (c).

PART II—FIGURING THE UNDERPAYMENT AND PENALTY

Line 2—Enter the $5,000 statutory exemption as follows:

(i) If the LLET tax on Line 1, Column (a) is zero, enter $5,000

KRS 141.990(3) provides that unless a corporation or

on Line 2, Column (b); (ii) If Line 1, Column (a) is $5,000

limited liability pass-through entity meets the exception in

or greater, enter $5,000 on Line 2, Column (a); or (iii) If

Part I of this form, a corporation’s or limited liability pass-

the LLET on Line 1 Column (a) is greater than zero but

through entity’s declaration underpayment is determined

less than $5,000, enter the amount from Line 1, Column

by subtracting $5,000 and the estimated tax payments

(a) on Line 2, Column (a) and the balance of the $5,000

actually made from 70% of the income tax liability due

on Line 2, Column (b).

under KRS 141.040 as computed on the tax return filed

for the tax year. If the corporation or limited liability pass-

through entity has a declaration underpayment, complete

Line 3—Enter the amount on Line 1 less the amount on

Lines 1 through 7 to compute the underpayment penalty

Line 2 for each column.

as provided by KRS 131.180(3).

Line 4—Divide Line 3, Columns (a) and (b) by the amount

PART III—LATE PAYMENT INTEREST

on Line 3, Column (c) and enter these percentages

(rounded to nearest whole percent) in the respective

columns.

KRS 141.042(1) provides that every corporation and limited

liability pass-through entity shall make a declaration

of estimated tax if the tax imposed by KRS 141.040

Line 5—Enter the installment due dates from left to right

(corporation income tax) and KRS 141.0401 (limited

in each column as follows: (i) if the tax imposed by KRS

liability entity tax) can reasonably be expected to exceed

141.040 and 141.0401 for the taxable year was reasonably

$5,000. KRS 141.042(3)(b) provides that the estimated

expected to exceed $5,000 before June 2 of the taxable

tax in excess of $5,000 shall be the estimated tax due for

calendar year, enter June 15, September 15 and December

purposes of KRS 141.042 and 141.044.

15 in Columns (a), (b) and (c); (ii) if the tax for the taxable

year was reasonably expected to exceed $5,000 after

June 1 and before September 2 of the taxable calendar

KRS 141.042(4) provides the due date of each estimated

year, enter September 15 and December 15 in Columns

tax payment, and KRS 141.044(1) provides the amount of

(a) and (b); and (iii) if the tax for the taxable year was

each estimated tax payment. KRS 141.985 provides that

reasonably expected to exceed $5,000 after September 1

interest shall accrue at the tax interest rate as provided

of the taxable calendar year, enter December 15 in Column

by KRS 131.010(6) if a corporation or limited liability pass-

(a). If the tax return is for a fiscal year, enter the 15th day

through entity fails to pay the tax due on or before the

of the sixth month, 15th day of the ninth month and 15th

due date prescribed. If the corporation or limited liability

day of the 12th month. Note: If a payment date falls on a

pass-through entity underpaid an estimated tax payment

holiday or weekend, the applicable payment date is the

or paid an estimated tax payment late, complete lines 1

next working day.

through 16 to determine the interest due.

Form 2220-K - Underpayment And Late Payment Of Estimated Income Tax And Llet - 2011 Page 3

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