Form 221 - Underpayment Of Estimated Tax By Individuals Instructions (Page 2 of 5) in pdf

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If you have to make Arizona estimated income tax payments,

If you are requesting a penalty and interest waiver due to

your payments must reasonably reflect your Arizona income

a casualty, disaster, or other unusual circumstances,

tax liability for the taxable year. Your combined Arizona

attach documentation such as copies of police and

estimated income tax payments and Arizona withholding

insurance company reports.

must total one of the following.

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If you are requesting a penalty and interest waiver due to

90 percent of the tax due for 1999.

retirement or disability, attach documentation that shows

your retirement date (and your age on that date) or the

100 percent of the tax due for 1998 if you were required

date you became disabled.

to file and did file a 1998 Arizona income tax return.

Line 2 –

Part A - Calculation of Underpayment

Enter your 1999 income tax liability from Form 140, page 1,

Complete lines 2 through 13 to determine if you underpaid

line 27, or Form 140PY, page 1, line 29, or Form 140NR,

your 1999 Arizona estimated income tax payments.

page 1, line 29.

Penalty and Interest Exceptions

NOTE: If you compute your tax liability under the claim of

right provisions enter the net tax liability as computed under

You will not have to pay the penalty and interest if either 1

the claim of right provisions.

or 2 below applies.

Line 3 –

You had no federal tax liability for 1998. You were also

a U.S. citizen or resident of the U.S. for the entire year

Enter any tax credits claimed on your 1999 individual

and your 1998 tax return was (or would have been had

income tax return from Arizona Form 301.

you been required to file) for a full 12 months.

Line 4 –

The total tax shown on your 1999 federal income tax

Subtract line 3 from line 2. This is your 1999 tax liability.

return minus your federal withholding is less than

$1000.

Line 5 –

If either 1 or 2 above apply to you, check the box on line 1

Multiply the amount on line 4 by 90 percent. Enter the result.

and complete lines 2 through 13.

Line 6 –

Penalty and Interest Waivers

Enter your 1998 tax liability (after tax credits). Only enter an

If you have an underpayment on line 13, the department will

amount on line 6 if you were required to file and did file an

waive all or part of the penalty and interest for that

Arizona personal income tax return for 1998. If you were not

underpayment if the department determines that either 1 or 2

required to file or did not file an Arizona personal income

below applies.

tax return for the preceding tax year, skip this line.

The underpayment was due to a casualty, disaster, or

Line 7 –

other unusual circumstances, and it would be inequitable

If you entered an amount on line 6, enter the lesser of line 5

to impose the penalty.

or line 6. If you did not enter an amount on line 6, enter the

In 1998 or 1999, you retired after age 62 or became

amount from line 5.

disabled, and your underpayment was due to reasonable

Line 8 –

cause.

In columns (a) through (d), enter the due dates for your

To request a waiver for an underpayment described in either

federal estimated income tax payments if different from the

1 or 2 above, do the following.

preprinted dates.

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Check the box on line 1.

Line 9 –

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Complete Form 221 through line 40 without regard to

the waiver. Write the amount you want waived in

Divide the amount on line 7 by four (4). Enter the result in

parentheses on the dotted line next to line 41. Subtract

each column. In some cases you did not have to make your

this amount from the total penalty and interest you

payments in four equal installments. If you did not have to

figured without regard to waiver, and enter the result on

make your payments in four equal installments, check the

line 41.

box and enter the amount of your required payment(s) in the

appropriate column. You did not have to make payments in

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Attach Form 221 and a statement to your return

four equal installments if you made your payments under any

explaining the reasons you were unable to meet the

of the following methods.

estimated tax requirements. Also show the time period

for which you are requesting a waiver.

Form 221 - Underpayment Of Estimated Tax By Individuals Instructions Page 2

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