Instructions For Form 221 - Underpayment Of Estimated Tax By Individuals

Arizona Form 221

List only the payments made during the dates shown in the

2. You did not list any payments in the table. You will

table heading. Apply the following rules.

need to calculate the penalty for rate periods 2, 3, and 4.

To do this, complete column (a) of lines 20, 21, 23, 24,

1. If you have any withheld Arizona income tax, the

26, and 27.

department considers you to have paid ¼ of these

3. The payment listed in the table did not reduce the

amounts on each payment due date. You may treat these

underpayment to zero, and no other payments are listed.

amounts paid on a different due date, if you can show

Make another computation on lines 20, 21, 23, 24, 26,

otherwise.

and 27 to calculate the penalty on the underpayment

For example, if you had $4,000 of Arizona income tax

balance that remained unpaid for the entire rate period.

withheld during 2013, list $1,000 as being paid on June

In this case, enter another number in the entry space for

17, 2013, September 16, 2013, and January 15, 2014, in

lines 17 and 18, as follows:

the proper table. Do not list the withholding attributable

On line 17, enter "76". This is the total number of days

to the first payment due date April 15, 2013.

in the first rate period (see the chart).

2. List any amount that you pay with your tax return as a

On line 18, make the computation and enter the result.

payment. Use the date you file your return as the payment

The "underpayment" in this computation is the balance

date, unless you file late. In that case, use April 15,

of the underpayment remaining in the period.

2014.

4. Other payments are listed in the table and the first

payment was not enough to reduce the underpayment to

Chart of Total Days per Period

zero. Make a separate computation for each payment

If an underpayment remained unpaid for an entire period,

listed until the underpayment is reduced to zero. If there

use the chart below to determine the number of days to enter

is still an underpayment balance after applying all of the

on line 17, columns (a) and (b), line 20, columns (a), (b), and

payments, you will need to calculate the penalty on the

(c), line 23, columns (a), (b), and (c), and line 26 columns

(a), (b), (c), and (d).

balance of the underpayment in the same manner as

explained in number 2 above.

Rate Period

(a)

(b)

(c)

(d)

1 (line 17)

Rate Periods 2, 3, and 4

2 (line 20)

If an underpayment balance remains after applying any

3 (line 23)

payments in Table 1, compute the penalty attributable to that

4 (line 26)

105

balance on lines 20 and 21, then if necessary, on lines 23 and

For example, if you have an underpayment on line 15,

24 and 26 and 27.

column (a), but show no payments, you would enter "76" on

Use the same steps as explained under Rate Period 1 above,

line 17.

but use the date and penalty rate shown on lines 20 and 21,

Rate Period 1

or lines 23 and 24, or lines 26 and 27.



When figuring the penalty for rate period 2, be sure to

Enter on line 17 the number of days from 4/15/13 to the date

use only the payments listed in Table 2.

of the first payment listed in Table 1. If no payments are

listed, enter "76".



When figuring the penalty for rate period 3, be sure to

If You Listed a Payment in Table 1

use only the payments listed in Table 3.



On a separate sheet of paper, apply the payment to the

When figuring the penalty for rate period 4, be sure to

underpayment shown on line 15. The underpayment for the

use only the payments listed in Table 4.

computation on line 18 is the amount of the payment applied to

NOTE: Penalty compounds annually on January 1 of each

the line 15 underpayment. If the payment is more than the

year. Add any penalty outstanding on that date to the

underpayment, apply only an amount equal to the underpayment

principal amount of the tax (installment underpayment/late

and use that amount for the line 18 computation.

payment). The amount added to the principal becomes a part

If You Did Not List Any Payments in Table 1

of the principal and accrues penalty until paid.

The underpayment is the whole underpayment balance since

Line 30 - Total Penalty

the entire underpayment was unpaid for the whole rate

Add the amounts in columns (a), (b), (c), and (d), line 29.

period.

Enter the total. Also, enter this amount on Form 140, page 1,

Determine if You Need to Make More Computations

line 50, or Form 140PY, page 1, line 52, or Form 140NR.

Use the following information to see if you need to make

Page 1, line 50.

more computations.

Annualized Income Installment Worksheet

1. The payment listed in the table reduced the

If your income varied during the year because, for example,

underpayment to zero. You do not need to make any

you operated your business on a seasonal basis, you may be able

further computations for column (a). Calculate the

to lower or eliminate the amount of one or more required

penalty for any other underpayments shown in columns

(b) through (d) of line 15.

Instructions For Form 221 - Underpayment Of Estimated Tax By Individuals - 2013 Page 4

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