Instructions For Form 2210 - 2008 (Page 4 of 6) in pdf

Line 25

listed, enter “76” (see Table 2 on this page), the number of days

until 6/30/08, the end of the first rate period.

If line 25 is zero for all payment periods, you do not owe a

Example 3. You had an underpayment of $5,000 on line

penalty. But if you checked box C or D in Part II, you must file

Form 2210 with your return. If you checked box E, you must file

25, column (a), and your first payment shown in Table 1 was

made on 4/30/08 in the amount of $3,000. Enter “15” (number

page 1 of Form 2210 with your return.

of days from 4/15 to 4/30) on line 27, column (a).

In certain circumstances, the IRS will waive all or part of the

More than one payment made. If more than one payment

underpayment penalty. See Waiver of Penalty on page 2.

was applied to fully pay the underpayment amount, enter the

Section B—Figure the Penalty

number of days after the due date each payment was made.

Before completing Section B, read the following instructions

Example 4. Assume the same facts as in Example 3. You

through Rate Periods 3 and 4 on page 5.

made a second payment of $5,000 on June 15. Since the

underpayment amount for column (a) was $5,000, after you

Figure the penalty for each period by applying the

made the first $3,000 payment April 30, your new

appropriate rate against each underpayment shown on line 25.

underpayment amount would be $2,000. That was paid June

The penalty is figured for the number of days that the

15, 61 days after the due date (4/15). Enter “15” and “61” on

underpayment remained unpaid.

line 27, column (a) (see illustration under Example 5 below).

Your payments are applied first to any underpayment

Line 28

balance on an earlier installment. It does not matter if you

designate a payment for a later period. See Example 2 below.

Make the computation requested on line 28 and enter the

result. If more than one payment was required to fully satisfy

The rates are established at various times throughout the

the underpayment amount, you will need to make a separate

year. For the period covered by the 2008 Form 2210, there are

computation for each payment. See the examples below and in

four rates in effect over four rate periods. If an underpayment

chapter 4 of Pub. 505.

remained unpaid for more than one rate period, the penalty on

that underpayment will be figured using more than one

Example 5. Assume the same facts as in Example 4. On

computation.

line 28, enter the penalty for each underpayment: $7.38 ($3,000

× (15 ÷ 366) × .06) and $20 ($2,000 × (61 ÷ 366) × .06). The

Use lines 27, 29, 31, and 33 to figure the number of days the

entries are illustrated below.

underpayment remained unpaid. Use lines 28, 30, 32, and 34 to

figure the actual penalty amount by applying the rate to the

(a)

underpayment for the number of days it remained unpaid.

4/15/08

Example 2. You had a $500 underpayment remaining after

Days:

your April 15 payment. The June 15 installment required a

payment of $1,200. On June 10, you made a payment of

$1,200 to cover the June 15 installment. However, $500 of this

payment is applied first to the April 15 installment. The penalty

7.38

for the April 15 installment is figured from April 15 to June 10

20.00

(56 days). The amount remaining to be applied to the June 15

installment is $700.

Since the underpayment balance in column (a) is fully

Total days per rate period. If an underpayment remained

satisfied, next go to column (b). See Example 6 below.

unpaid for an entire rate period, use the chart below to

Example 6. Assume the same facts as in Example 4 and

determine the number of days to enter in each column. The

Example 5. Your June 15 payment of $5,000 would have fully

chart is organized in the same format as Form 2210, Part IV,

paid the second period underpayment amount (column b), but

Section B.

because payments are applied first to an underpayment

balance in an earlier period, your second required installment is

underpaid by $2,000.

Table 2. Chart of Total Days

The next unapplied payment is $5,000 made on 9/15/08. On

line 27, column (b), enter “15” — the number of days from 6/15

Rate Period

(a)

(b)

(c)

(d)

to 6/30, the end of the first rate period. On line 28, enter $4.92

1 (line 27)

—

($2,000 × (15 ÷ 366) × .06).

2 (line 29)

—

(a)

(b)

4/15/08

6/15/08

3 (line 31)

—

Days:

4 (line 33)

105

For example, if you have an underpayment on line 25,

7.38

column (a), but Table 1 shows no payments made by

4.92

4/15/08, you would enter “76” on line 27, column (a).

20.00

When you make a payment during a rate period, see

The remaining underpayment balance will be calculated in

TIP

Table 4-1 (Pub. 505, chapter 4) for an easy way to

the second rate period on lines 29 and 30, column (b). See

figure the number of days the payment is late.

Example 7 on page 5.

Rate Period 1

Rate Period 2

First, complete Section B, column (a), lines 27 through 34, for

If an underpayment balance remains after applying any

an underpayment shown on line 25, column (a). If there is also

payments made during the first rate period, figure the penalty

an underpayment shown in column (b), (c), or (d) on line 25,

attributable to that balance on lines 29 and 30. Generally, use

then complete lines 27 through 34 for those columns in a similar

the same steps as explained under the instructions for Rate

manner.

Period 1, but use the dates and interest rate shown on lines 29

and 30.

Line 27

Line 29

If there was only one payment made between 4/15/08 and

6/30/08, enter on line 27, column (a), the number of days from

Enter on line 29, column (a), the number of days from 6/30/08

4/15/08 to the date that payment was made. If no payments are

to the date of the first unapplied payment made during the

-4-

Instructions For Form 2210 - 2008 Page 4

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