Instructions For Form 1120-W - Estimated Tax For Corporations

Refiguring Estimated Tax

Line 12. Additional 5% Tax

If, after the corporation figures and deposits estimated tax, it

Members of a controlled group are treated as one group to figure

finds that its tax liability for the year will be more or less than

the applicability of the additional 5% tax and the additional 3%

originally estimated, it may have to refigure its required

tax. If an additional tax applies, each member will pay that tax

installments. If earlier installments were underpaid, the

based on the part of the amount used in each taxable income

corporation may owe a penalty.

bracket to reduce that member's tax. See section 1561(a). Each

member of the group must enter on line 12 its share of the

An immediate catchup payment should be made to reduce

smaller of (a) 5% of the taxable income in excess of $100,000 or

the amount of any penalty resulting from the underpayment of

(b) $11,750.

any earlier installments, whether caused by a change in

Line 13. Additional 3% Tax

estimate, failure to make a deposit, or a mistake.

If the additional 3% tax applies, each member of the controlled

Specific Instructions

group must enter on line 13 its share of the smaller of (a) 3% of

the taxable income in excess of $15 million or (b) $100,000. See

All line references on Form 1120-W are references to

the instructions for line 12 above.

Form 1120, U.S. Corporation Income Tax Return. All

Line 15. Alternative Minimum Tax

other entities must determine their estimated tax liability

CAUTION

(AMT)

by using the applicable line from their income tax return and the

maximum rate that is in effect for their applicable tax year.

Note. Skip this line if the corporation is treated as a “small

Line 1. Qualified Personal Service

corporation” exempt from the AMT under section 55(e).

AMT is generally the excess of tentative minimum tax (TMT)

Corporations

for the tax year over the regular tax for the tax year. A limited

amount of the foreign tax credit, as refigured for the AMT, is

A qualified personal service corporation is taxed at a flat rate of

allowed in computing the TMT. Use the 2016 Form 4626 and the

35% on taxable income. A corporation is a qualified personal

2016 Instructions for Form 4626 as a guide.

service corporation if it meets both of the following tests.

Line 17. Tax Credits

Substantially all of the corporation's activities involve the

performance of services in the fields of health, law, engineering,

For information on tax credits the corporation can take, see the

architecture, accounting, actuarial science, performing arts, or

2016 Instructions for Form 1120, Schedule J, lines 5a through

consulting.

5e, or the instructions for the applicable lines and schedule of

At least 95% of the corporation's stock, by value, is owned,

other income tax returns.

directly or indirectly, by employees performing the services listed

above, retired employees who had performed such services, any

Line 19. Other Taxes

estate of an employee or retiree described above, or any person

For information on other taxes the corporation may owe, see the

who acquired the stock of the corporation as a result of the death

2016 Instructions for Form 1120, Schedule J, line 9, or the

of an employee or retiree (but only for the 2-year period

instructions for the applicable line and schedule of other income

beginning on the date of the employee's or retiree's death).

tax returns.

Lines 2, 5, and 8. Members of a

Line 21. Credit for Federal Tax Paid

Controlled Group

on Fuels and Other Refundable

Members of a controlled group, complete lines 2, 5, and 8 as

Credits

follows:

Enter on line 2 the smaller of the amount on line 1, or the

See Form 4136, Credit for Federal Tax Paid on Fuels, to find out

member's share of the $50,000 amount.

if the corporation qualifies to take this credit. Also include on

Enter on line 5 the smaller of the amount on line 4, or the

line 21 any other refundable credit, including any credit the

member's share of the $25,000 amount.

corporation is claiming under section 4682(g)(2) for tax on

Enter on line 8 the smaller of the amount on line 7, or the

ozone-depleting chemicals. For information on other refundable

member's share of the $9,925,000 amount.

credits, see the Instructions for Form 1120, Schedule J, line 19,

Equal apportionment plan. If no apportionment plan is

or the instructions for the applicable line or schedule of other

adopted, members of a controlled group must divide the amount

income tax returns.

in each taxable income bracket equally among themselves. For

Line 23a. 2016 Tax

example, Controlled Group AB consists of Corporation A and

Corporation B. They do not elect an apportionment plan.

Figure the corporation's 2016 tax in the same way that line 22 of

Therefore, each corporation is entitled to:

this worksheet was figured, using the taxes and credits from the

$25,000 (one-half of $50,000) on line 2,

2016 income tax return. Large corporations, see the instructions

$12,500 (one-half of $25,000) on line 5, and

for line 25 below.

$4,962,500 (one-half of $9,925,000) on line 8.

If a return was not filed for the 2016 tax year showing a

Unequal apportionment plan. Members of a controlled group

liability for at least some amount of tax or the 2016 tax year was

can elect an unequal apportionment plan and divide the taxable

for less than 12 months, do not complete line 23a. Instead, skip

income brackets as they want. There is no need for consistency

line 23a and enter the amount from line 22 on line 23b.

among taxable income brackets. Any member may be entitled to

Line 24. Installment Due Dates

all, some, or none of the taxable income bracket. However, the

total amount for all members cannot be more than the total

Calendar-year taxpayers: Enter 4-18-2017, 6-15-2017,

amount in each taxable income bracket.

9-15-2017, and 12-15-2017, respectively, in columns (a) through

(d). If the due date falls on a Saturday, Sunday, or legal holiday,

enter the next business day.

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Instructions for Form 1120-W (2017)

Instructions For Form 1120-W - Estimated Tax For Corporations - 2017 Page 2

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