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Line 28 will show $7.40, $33.53, and

Estates and trusts with short tax years,

$55.23, computed as follows: $3,000 ×

3. Subtract line 2 from line 1 . .

see Notice 87-32.

15/365 × .06 (first payment), $3,000 ×

Form 1040NR or 1040NR-EZ

68/365 × .06 (second payment), and

4. Enter the number from

$2,000 × 168/365 × .06 (remaining

Schedule AI, line 5 . . . . . .

Filers

underpayment balance).

If you are filing Form 1040NR or

5. Multiply the amount on line 1

Then figure the penalty for Rate

1040NR-EZ and you did not receive

by line 4 . . . . . . . . . . . . . .

Period 2 (lines 29 and 30) on the

wages as an employee subject to U.S.

Note: If the amount on line 3

remaining $2,000 balance.

income tax withholding, the instructions

is zero, stop here and enter

for Schedule AI are modified as follows.

the amount from line 5 on

Rate Period 2

Schedule AI, line 6.

1. Skip column (a).

If an underpayment balance remains

2. Enter on line 1 your income for

after applying any payments in Table 1,

6. Multiply the amount on line 3

the period that is effectively connected

figure the penalty attributable to that

by the number on line 4 . . .

with a U.S. trade or business.

balance on lines 29 and 30. Generally,

3. Increase the amount on line 17

7. Multiply the amount on line 6

use the same steps as explained under

by the amount determined by

by .80 . . . . . . . . . . . . . . .

the instructions for Rate Period 1. But

multiplying your income for the period

use the dates and interest rate shown

that is not effectively connected with a

8. Enter the amount from

on lines 29 and 30 and use only the

U.S. trade or business by the following.

Schedule AI, line 3 . . . . . .

•

payments listed in Table 2.

In column (b), 72%.

•

In column (c), 45%.

Line 29

9. Enter $145,950 ($72,975 if

•

In column (d), 30%.

married filing separately) . .

Enter on line 29, column (a), the

However, if you can use a treaty rate

number of days from 9/30/05 to the

lower than 30%, use the percentages

10. Subtract line 9 from line 8 . .

date of the first payment listed in

determined by multiplying your treaty

Table 2. If no payments are listed in

rate by 2.4, 1.5, and 1, respectively.

11. Multiply the amount on line

Table 2, enter “197.”

4. Enter in line 22, column (b),

10 by .03 . . . . . . . . . . . . .

Line 30

the amount from Form 2210, Part I,

12. Enter the smaller of line 7 or

line 9. In columns (c) and (d), enter

Figure line 30 in the same manner as

line 11 . . . . . . . . . . . . . . .

of that amount.

explained for line 28.

5. Skip column (b), lines 20 and 23.

13. Subtract line 12 from line 5.

Schedule AI—

Enter the result here and on

Part I—Annualized Income

Schedule AI, line 6 . . . . . .

Annualized Income

Installments

Installment Method

Line 10

Line 1

Multiply $3,200 by your total

If your income varied during the year

Figure your total income for the period

exemptions. But if line 3 is more than

because, for example, you operated

minus your adjustments to income for

the amount shown for your filing status

your business on a seasonal basis, you

the period. Include your share of

in the table below, use the following

may be able to lower or eliminate the

partnership or S corporation income or

worksheet to figure the amount to enter

amount of one or more required

loss items for the period.

on line 10.

installments by using the annualized

income installment method. Use

If you are self-employed, be sure to

Single . . . . . . . . . . . . . . . . . $145,950

Schedule AI to figure the required

take into account the deduction for

Married filing jointly or

installments to enter on Form 2210,

one-half of your self-employment tax.

qualifying widow(er) . . . . . . . $218,950

line 18.

To figure this amount for each period,

Married filing separately . . . . $109,475

complete Schedule AI, Part II, and

If you use Schedule AI for any

Head of household . . . . . . . . $182,450

divide the amount in each column on

payment due date, you must use it for

line 34 by 8, 4.8, 3, and 2, respectively.

all payment due dates. To figure the

1. Enter the amount from

amount of each required installment,

Line 2

Schedule AI, line 3 . . . . . .

Schedule AI automatically selects the

Estates and trusts, do not use the

smaller of the annualized income

2. Enter the amount shown for

amounts shown in columns (a) – (d).

installment or the regular installment

your filing status from the

Instead, use 6, 3, 1.71429, and

(increased by the amount saved by

above table . . . . . . . . . . .

1.09091, respectively, as the

using the annualized income

annualization amounts.

installment method in figuring any

3. Subtract line 2 from line 1 . .

earlier installments).

Line 6

4. Divide the amount on line 3

To use the annualized income

Multiply line 4 by line 5 and enter the

by $2,500 ($1,250 if married

installment method, you must do all

result on line 6. But if line 3 is more

filing separately). If the result

three of the following.

than $145,950 ($72,975 if married filing

is not a whole number,

separately), use the following

1. Enter the amount from Schedule

increase it to the next whole

worksheet to figure the amount to enter

AI, line 25, in each column of

number . . . . . . . . . . . . . .

on line 6.

Form 2210, line 18.

2. Check box C in Part II.

5. Multiply the number on line 4

1. Enter the amount from

3. Attach both Form 2210 and

by .02. Enter the result as a

Schedule AI, line 4 . . . . . .

Schedule AI to your return.

decimal but not more than 1

2. Enter the amount included

6. Multiply $3,200 by your total

Additional Information

on line 1 for medical and

exemptions . . . . . . . . . . .

See Pub. 505 for more details about

dental expenses, investment

the annualized income installment

interest, casualty or theft

method and a completed example.

losses, and gambling losses

-6-

Instructions For Form 2210 - Underpayment Of Estimated Tax By Individuals, Estates, And Trusts - 2005 Page 6

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