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2014

MARYLAND

UNDERPAYMENT OF ESTIMATED

FORM

INCOME TAX BY CORPORATIONS

500UP

AND PASS-THROUGH ENTITIES

INSTRUCTIONS

GENERAL INSTRUCTIONS

fourth column. For Pass-Through Entities (PTE), see specific

instructions.

Purpose of Form Form 500UP is used by a corporation or a

pass-through entity to calculate the amount of interest and

Instructions for Line 7: Enter all payments made by the

penalty for failure to pay the required amount of estimated

due date of the fourth quarterly estimated tax payment in the

income tax when due.

appropriate column according to the instructions for line 6.

That is, all payments made by the 15th day of the fourth

NOTE: Form 500UP is not required. The Maryland Revenue

month of the entity’s fiscal year should be entered in the first

Administration Division will calculate the interest and

column. All payments made by the 15th day of the sixth

penalty and notify the entity of any balance due.

month (including those shown in the first column) should be

General Requirements Every corporation or pass-through

entered in the second column. All payments made by the 15th

entity that reasonably expects its Maryland taxable income to

day of the ninth month should be entered in the third column

develop a tax in excess of $1,000 for the tax year or period

and all payments made by the fourth quarter due date should

must make estimated income tax payments. The total estimated

be entered in the fourth column.

tax payments for the year must be at least 90% of the tax

Instructions for Line 9: The interest factors for calendar

developed for the current tax year or 110% of the tax that

year corporations or S corporations are: 1st period – .0217;

was developed for the prior tax year. At least 25% of the total

2nd period – .0325; 3rd period – .0325; 4th period – .0325.

estimated tax must be remitted by each of the four installment

The interest factors for calendar year partnerships or limited

due dates. Corporations may not use the annualization

liability companies are 1st period – .0217; 2nd period – .0325;

method.

3rd period – .0433; 4th period – .0325.

In the case of a short tax period, the total estimated tax

The factors represent the interest rate for the portion of the

required is the same as for a regular tax year: 90% of the tax

year between the due date of each quarter and the due date

developed for the current (short) tax year or 110% of the tax

of the next quarter. The rate is 1/12 of 13% for each month

that was developed for the prior tax year. The minimum

or part of a month from the due date. If your estimated tax

estimated tax payment for each of the installment due dates

payment was not timely, but was paid earlier than the due

is the total estimated tax required divided by the number of

date of the next quarter, adjust the factor as follows: count

installment due dates occurring during the short tax year.

the number of months from the due date that the payment

However, if the entity has a short tax period of less than 4

was late. Treat a partial month as one month. Divide that

months, it does not have to pay estimated tax nor file Form

number by twelve and multiply it by the 13% annual rate.

500UP.

Apply this adjusted factor to the underpaid amount on line 8.

Maryland law provides for the accrual of interest and imposition

Instructions for Line 12:

Penalty for underpayment of

of penalty for failure to pay the required amount of estimated

estimated tax is due for any quarter where timely payments

tax when due.

are less than 50% of one-quarter of the annual estimated tax

When and Where to File File Form 500UP by the original

required (line 4). Calculate the penalty by adding the

or extended due date for filing the Form 500 – Corporation

underpayments in all applicable quarters (do not use cumulative

Income Tax Return or Form 510 – Pass-Through Entity Income

amounts from line 8) and multiplying the total by 10%. Enter

Tax Return. If used, Form 500UP must be attached to Form

the result on line 12.

500 or Form 510 and filed with the Comptroller of Maryland,

Pass-Through Entities The due dates of estimated payments

Revenue Administration Division, 110 Carroll Street, Annapolis,

and annual returns for S corporations are the same as the due

Maryland 21411-0001.

dates for corporations. For other PTEs, the due date, for the

fourth quarterly payment is the 15th day of the month

SPECIFIC INSTRUCTIONS

following the close of the tax year (January 15 for calendar

Name and Other Information Type or print the name as

year filers) and the due date for the annual return is the 15th

shown on Form 500 or Form 510 in the designated area. Enter

day of the fourth month following the close of the tax year

the Federal Employer Identification Number (FEIN). If a FEIN

(April 15 for calendar year filers). These differences will cause

has not been secured, enter “APPLIED FOR” followed by the

variations in the interest factors.

date of application. If a FEIN has not been applied for, do so

Partnerships and limited liability companies electing to annualize

immediately.

must allocate to each period (and enter on line 6) a payment

Tax Year or Period Enter the beginning and ending dates in

amount based on the income received between the dates for

the space provided at the top of Form 500UP. The form used

each installment period. If the interest calculated on line 11 is

for filing must reflect the preprinted tax year in which the

zero because the income was not received evenly throughout

corporation’s tax year begins.

the year, enter code number “301” in one of the boxes

marked “code number” on the front of Form 510, and attach

Calculation of Interest and Penalty Enter the amounts as

this form to the return.

required for lines 1 through 13.

Instructions for Line 6: The first period extends from the

beginning of the entity’s fiscal year to the last day of the third

month. The second period extends from the beginning of the

fiscal year to the last day of the sixth month. The third period

extends from the beginning of the fiscal year to the last day

of the ninth month. The fourth period extends from the

beginning of the fiscal year to the last day of the twelfth

month. Therefore, enter 1/4 of the estimated tax required on

line 4 in the first column of line 6, 1/2 in the second column,

3/4 in the third column and an amount equal to line 4 in the

COM/RAD-005

Form 500up - Underpayment Of Estimated Income Tax By Corporations And Pass-Through Entities - 2014 Page 2

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