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CT-222 (2003) (back)

Instructions

Attach this form to either your New York State franchise tax return or MTA surcharge return.

Line 4 - See Payment of estimated tax above.

New for 2003

Line 8 - Corporate partners: Include amounts paid on time and on your

Temporary increase in the mandatory first installment of estimated tax

behalf by a partnership. A payment of estimated tax is applied against

For tax years beginning on or after January 1, 2003, and before January 1,

underpayments of required installments in the order in which the

2006, the Tax Law has been amended to provide an increase in the

installments are required to be paid.

mandatory first installment from 25% of the preceding year’s tax to 30%.

This increase is for general business corporations (Article 9-A), banking

Example: Calendar-year taxpayer

corporations (Article 32), insurance corporations (Article 33), and entities

First

Second

Third

Fourth

subject to tax under Article 9, sections 184, 186-a, or 186-e whose

Due date ...........................

3/15

6/15

9/15

12/15

preceding year’s tax, exclusive of the metropolitan transportation business

25% of prior year tax

tax (MTA surcharge), exceeds $100,000. Taxpayers subject to the MTA

or MTA surcharge ...........

1,500

surcharge that are required to pay their first installment at the 30% rate

Installment amount due ....

1,000

must also calculate their estimated tax for the surcharge at 30% of the

Paid on time/credited ........

1,500

500*

1,000 **

preceding year’s MTA surcharge.

Underpayment ..................

1,000

500

Estimated tax payments required by partnerships, limited

Penalty is due on $1,000 from 6/15 to 9/15.

liability companies (LLCs), and New York S corporations

Penalty is due on $500 from 9/15 to 12/15.

For tax years ending after December 31, 2002, all partnerships, LLCs that

* Paid $1,500, $1,000 applied to 6/15 installment; $500 applied to 9/15 installment.

are treated as partnerships for federal purposes, or New York

** Paid $1,500, $500 applied to 9/15 installment; $1,000 applied to 12/15 installment.

S corporations that had income from New York sources, are required to pay

estimated taxes on behalf of nonresident individuals and C corporation

Exceptions to the underpayment penalty

partners, members, or shareholders on their distributive or pro rata share of

You will not have to pay a penalty if you made all tax payments on time and

the respective entities income. See Form IT-2659, Estimated Tax Penalties

they equal or exceed the amount that would have been required to be paid

for Partnerships and New York S Corporations , to determine if you

by each installment date if the estimated tax were an amount determined

underpaid estimated tax and, if so, to compute the penalty due.

under any of the exceptions listed below.

Northeast Blackout relief

A different exception may be applied to each underpayment. If no exception

Taxpayers who, on or before August 22, 2003, filed the declarations of

applies, complete lines 18 through 39 to determine the amount of the penalty.

estimated tax, or made the installment payments, both required on the

Exceptions 1 and 2, on lines 14 and 15, do not apply to large corporations.

original due date of August 15, 2003, will be deemed to have filed the

declarations and made the installment payments on the original due date

Line 14, exception 1 (not to be used by large corporations): Allows you to

and will not be subject to underpayment penalties. For more information,

substitute for the current year’s estimated tax the tax reported on your 2002

see Important Notice N-03-26, Announcement Regarding the Northeast

return. You must have filed a franchise tax return showing a tax liability for

Blackout of August 2003.

the preceding tax year, and that year must have consisted of 12 months.

General information

Line 15, exception 2 (not to be used by large corporations): Applies if the

amount you paid is equal to or more than the tax computed by using the

All general business corporations (including S corporations), banking,

current year’s rate but based on the facts shown on the prior year’s return

insurance, utilities (including providers of telecommunication services), and

and the law that applies to the prior year.

transportation and transmission corporations whose franchise tax for the

current tax year can reasonably be expected to be more than $1,000 after

Line 16, exception 3: Applies if the estimated tax you paid was equal to or

credits must file a declaration of estimated franchise tax and make

more than 91% (or 100% for large corporations) of the amount you would

quarterly installment payments.

owe if your estimated tax were a tax computed on annualized taxable

income for the months preceding an installment date.

Any corporation doing business in the Metropolitan Commuter

Transportation District (MCTD) that is required to make a declaration of

You may annualize income as follows:

estimated franchise tax must also make a declaration of estimated MTA

a. For the first 3, 4, or 5 months of the tax year, in the case of the

surcharge and make quarterly installment payments.

installment required to be paid in the 6th month.

b. For the first 6, 7, or 8 months of the tax year, in the case of the

If you do not pay the required amounts on time, you may have to pay an

installment required to be paid in the 9th month.

underpayment penalty for the period of underpayment.

c. For the first 9, 10, or 11 months of the tax year, in the case of the

Payment of estimated tax

installment required to be paid in the 12th month.

First installment - If the franchise tax on your previous year’s return or on

To annualize, multiply taxable income for the period by 12 and divide the

your request for extension of time for filing that return is more than $1,000,

result by the actual number of months in the period.

and does not exceed $100,000, you must pay 25% of the tax with the return

Line 17, exception 4: Applies if you have recurring seasonal income. You

or extension. If the franchise tax on your previous year’s return or on your

may annualize income by assuming that income earned in the current year

request for extension of time for filing that return exceeds $100,000, you must

is earned in the same seasonal pattern as in the three preceding tax years.

pay 30% of the tax with the return or extension. If you are subject to tax

under Tax Law section 1510(b)(1), and the tax exceeds $1,000, the

To avoid underpayment penalties, you must make up a reduction in

percentage is 40%.

estimated taxes resulting from using annualized income or seasonal

If you are liable for the MTA surcharge, a 25% first installment is required if

income by increasing the amount of the next installment determined under

your franchise tax is more than $1,000, and does not exceed $100,000. If

any other exception method by the amount of such reduction.

your franchise tax exceeds $100,000, a 30% first installment is required. If

For additional information about computing seasonal income, see Tax Law

you are subject to tax under Tax Law section 1510(b)(1), and the tax

Article 27, section 1085(d)(4).

exceeds $1,000, the percentage is 40%.

Computation of the underpayment penalty

The second, third, and fourth installments of estimated franchise tax and

MTA surcharge are due on the fifteenth day of the sixth, ninth, and twelfth

If no exception applies, complete lines 18 through 39 to determine the

months of your tax year.

amount of the penalty. The penalty is computed for the period of

underpayment at a rate set by Tax Law Article 27, section 1096(e)(1). Daily

Computation of underpayment

compounding of interest does not apply.

Complete lines 1 through 12 to determine any underpayment of estimated

taxes.

Line 39 — In each column enter the amount from line 38, or, if the

installment payment (line 10) equals 80% (.8) or more of line 1 divided by

Line 2 - Large corporations: Multiply the amount on line 1 by 100%. All

four, multiply the penalty shown in the corresponding column of line 38 by

others: Multiply line 1 by 91%. A large corporation is one that had, or whose

75% (.75), and enter the result.

predecessor had, allocated entire net income (ENI) of at least $1 million for

any of the three tax years immediately preceding the tax year involved.

Need help?

Article 33 filers: For a nonlife insurance corporation subject to tax under Tax

Law section 1502-a, a large corporation is one that had allocated ENI of at

Internet access:

least $1 million for any of the three tax years immediately preceding the tax

(for information, forms, and publications)

year involved or had direct premiums, subject to the premiums tax under

Tax Law section 1502-a, exceeding $3,750,000 for any of the three

preceding tax years beginning on or after January 1, 2003.

Fax-on-demand forms: 1 800 748-3676

Business Tax Information Center:

1 800 972-1233

From areas outside the U.S. and outside Canada:

(518) 485-6800

41502030094

Hearing and speech impaired (telecommunications device for the deaf

(TDD) callers only): 1 800 634-2110

Instructions For Form Ct-222 - Underpayment Of Estimated Tax By A Corporation - 2003

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