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Prepayment of Minimum Tax

If a taxpayer elects a different annualization period

than the period used for federal purposes, the taxpayer

Corporations subject to the minimum tax that meet

must make an election with the Tax Commission at the

the prepayment requirement in the current year and

same time as provided in IRC §6655. Estimated tax

that had a tax liability of $100 (the minimum tax) for

payments should be made with form TC-559, Corpora-

the previous year may choose to prepay the minimum

tion/Partnership Payment Coupon.

tax amount of $100 on the 15th day of the 12th month

Corporations not making the required tax prepayments

instead of four increments of $25.

are subject to a penalty as stated in Penalties, below.

Corporations subject to the minimum tax that met the

prepayment requirement in the previous year and have

Penalties

a tax liability of $100 (the minimum tax) in the current

year may choose to prepay the minimum tax amount

Utah law (UC §59-1-401) provides penalties for not

of $100 on the 15th day of 12th month instead of four

ﬁ ling tax returns by the due date, not paying tax due

increments of $25. In this case, the corporation must

on time, not making sufﬁ cient prepayment on exten-

pay $100, not 90 percent.

sion returns, and not ﬁ ling information returns or sup-

porting schedules. Details of these penalties, along

Corporations subject to the minimum tax not making

with additional penalties, are at tax.utah.gov/billing/

the required tax prepayments are subject to a penalty

penalties-interest and in Pub 58, Utah Interest and

as stated in Penalties, below.

Penalties, at tax.utah.gov/forms.

Prepayment Requirements

The Tax Commission will calculate the penalty for

underpayment of required prepayments.

(Does not apply to One-day Target Corporations

electing under Section 338)

Exceptions to Penalty on

Estimated Tax

Extension Prepayments

Annualized Exception

The required extension prepayments must equal 90

percent of the current year tax liability (or, if applicable,

A corporation may annualize its income before determin-

the $100 minimum tax, whichever is greater) or 100

ing the amount of each estimated tax installment. Follow

percent of the previous year’s tax liability.

federal guidelines to determine annualized income. If

the corporation meets the annualized exception at the

Corporations should make estimated prepayments

federal level for any installment, check the appropriate

using form TC-559, Corporation/Partnership Payment

box(es) on Utah form TC-20MC, line 15.

Coupon.

Recurring Seasonal Exception

Quarterly Payments

A corporation with recurring seasonal income may

Every corporation having a Utah tax liability of $3,000

annualize its income before determining the amount

or more in the current taxable year, or a tax liability of

of each estimated tax installment. Follow federal guide-

$3,000 or more in the previous taxable year, must make

lines to determine seasonal income. If the corporation

quarterly estimated tax payments.

meets the seasonal exception at the federal level for

any installment, check the appropriate box(es) on Utah

A corporation is not subject to the estimated tax pay-

form TC-20MC, line 15.

ment requirements the ﬁ rst year it is required to ﬁ le a

Prepayment of Minimum Tax Requirement

return in Utah if the corporation makes a payment on

or before the due date, without the extension, equal to

See Prepayment of Minimum Tax instructions above.

or greater than the minimum tax.

NOTE: The prepayment penalty does not apply to a

Quarterly estimated tax payments are due (in four pay-

one-day target corporation under IRC Section 338.

ments) on the 15th day of the 4th, 6th, 9th and 12th

months of the corporation’s taxable year. Corporations

Interest

(in addition to penalties due)

may elect to make the quarterly estimated tax payments

equal to 100 percent of the prior year’s tax in four equal

Interest is assessed on underpayments from the due

payments, or 90 percent of the current year’s tax based

date until the liability is paid in full. The interest rate for

on the percentages below. As deﬁ ned in UC §59-7-504(2),

the 2013 calendar year is 2 percent.

the applicable percentage of the required payment for

Get Pub 58, Utah Interest and Penalties, which contains

annualized income installments, for adjusted seasonal

applicable interest rates at tax.utah.gov/forms or by

installments, and for estimated tax payments based on

calling or writing the Tax Commission.

the current year tax liability, is the following:

Installment

Percentage

Suspension for Failure

1st

22.5

to Pay Tax Due

2nd

45.0

3rd

67.5

Utah law provides for suspension of a corporation’s

4th

90.0

right to do business in Utah if it fails to pay taxes due

before 5:00 p.m. on the last day of the 11th month after

the due date.

Page 3

Instructions For Form Tc-20mc - Utah Tax Return For Miscellaneous Corporations - 2012 Page 5

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