Form 2220-K - Instructions For Form 2220-K - 2016

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2220-K
Page 3
41A720-S6 (10-16)
INSTRUCTIONS FOR FORM 2220-K
Commonwealth of Kentucky
DEPARTMENT OF REVENUE
Purpose of Form—This form is used by a corporation
KRS 141.042(4) provides the due date of each estimated
or limited liability pass-through entity required by KRS
tax payment, and KRS 141.044(1) provides the amount of
141.042 and KRS 141.044 to file a declaration of estimated
each estimated tax payment. KRS 141.985 provides that
tax to: (i) compute the underpayment penalty as provided
interest shall accrue at the tax interest rate as provided
by KRS 131.180(3) and KRS 141.990; and (ii) compute
by KRS 131.010(6) if a corporation or limited liability pass-
the interest on any late payment or underpayment of an
through entity fails to pay the tax due on or before the
estimated tax installment as provided by KRS 141.985.
due date prescribed. If the corporation or limited liability
pass-through entity underpaid an estimated tax payment
or paid an estimated tax payment late, complete lines 1
PART I—EXCEPTION
through 16 to determine the interest due.
KRS 141.990(3) provides that a corporation or limited
liability pass-through entity required by KRS 141.042 to
Line 1—Enter the LLET liability in Column (a), income tax
file a declaration of estimated tax and required to pay the
liability in Column (b) and the combined tax liability in
declaration of estimated tax by the installment method
Column (c) as follows:
prescribed by KRS 141.044(1) shall not be subject to the
penalty as provided in KRS 131.180 if the estimated tax
Enter on Line 1, Column (a) the 2016 LLET liability from
payments made under KRS 141.044(1) are equal to the
Form 720 or 720S, Part I, Line 6; or Form 725 or 765, Part
combined tax liability due under KRS 141.040 and KRS
II, Line 6; and enter on Line 1, Column (b) the 2016 income
141.0401 for the previous taxable year, and the combined
tax liability from Form 720, Part II, Line 8 or from Form
tax liability due under KRS 141.040 and KRS 141.0401
720S, Part II, Line 4. Also enter the total of Line 1, Columns
(a) and (b) on Line 1, Column (c).
for the previous taxable year was equal to or less than
$25,000. If the corporation or limited liability pass-through
If the combined tax liability imposed by KRS 141.040 and
entity meets this exception, check the box and complete
141.0401 for the prior tax year was equal to or less than
Lines 1 and 2 showing the combined tax liability for the
previous taxable year and the estimated tax payments for
$25,000 and the prior year’s combined tax liability is less
the current taxable year.
than the current year’s combined tax liability, enter on
Line 1, Column (a) the 2015 LLET liability from Form 720
PA RT I I — F I G U R I N G T H E U N D E R PAY M E N T A N D
or 720S, Part I, Line 6 or from Form 725 or 765, Part II, Line
PENALTY
6; and enter on Line 1, Column (b) the 2015 income tax
liability from Form 720, Part II, Line 8 or from Form 720S,
KRS 141.990(3) provides that unless a corporation or
Part II, Line 4. Also enter the total of Line 1, Columns (a)
limited liability pass-through entity meets the exception
and (b) on Line 1, Column (c).
in Part I of this form, a corporation or limited liability pass-
through entity required by KRS 141.042 to file a declaration
Line 2—Enter the $5,000 statutory exemption as follows: (i)
of estimated tax and required to pay the declaration of
If the LLET tax on Line 1, Column (a) is zero, enter $5,000
estimated tax by the installment method prescribed by
on Line 2, Column (b); (ii) If Line 1, Column (a) is $5,000
KRS 141.044(1) shall be subject to a penalty as provided
or greater, enter $5,000 on Line 2, Column (a); or (iii) If
in KRS 131.180 if the corporation or limited liability
the LLET on Line 1 Column (a) is greater than zero but
pass-through entity has a declaration underpayment.
less than $5,000, enter the amount from Line 1, Column
Declaration underpayment is determined by subtracting
(a) on Line 2, Column (a) and the balance of the $5,000
$5,000 and the declaration payments actually made from
on Line 2, Column (b).
70% of the combined tax liability due under KRS 141.040
and KRS 141.0401 as computed by the taxpayer on the
Line 3—Enter the amount on Line 1 less the amount on
tax return filed for the taxable year. If the corporation
Line 2 for each column.
or limited liability pass-through entity has a declaration
underpayment, complete Lines 1 through 11.
Line 4—Divide Line 3, Columns (a) and (b) by the amount
on Line 3, Column (c) and enter these percentages
PART III—LATE PAYMENT INTEREST
(rounded to nearest whole percent) in the respective
columns.
KRS 141.042(1) provides that every corporation and limited
liability pass-through entity shall make a declaration
Line 5—Enter in Columns (a), (b) and (c) the 15th day of the
of estimated tax if the tax imposed by KRS 141.040
sixth month, 15th day of the ninth month and 15th day of
(corporation income tax) and KRS 141.0401 (limited
the twelfth month of the entity’s taxable year, respectively.
liability entity tax) can reasonably be expected to exceed
$5,000. KRS 141.042(3)(b) provides that the estimated
Note: If a payment date falls on a holiday or weekend, the
tax in excess of $5,000 shall be the estimated tax due for
applicable payment date is the next business day.
purposes of KRS 141.042 and 141.044.

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