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2. File and pay by January 31, 2002. If you file your

If you have an overpayment on line 13 for the period, you

Arizona return by January 31, 2002, and pay in full the

may apply it to a prior period underpayment to stop the

amount stated on the return as payable, you do not have to

accrual of penalty on that underpayment. If you apply an

make the fourth estimated tax payment. Fiscal year filers

overpayment in this manner, use the date the overpayment

must file and pay by the last day of the month following the

was paid when you figure the penalty on the underpayment

close of the fiscal year.

on line 13.

You may then carry the remainder of the

overpayment forward to line 11 of the next period. If you do

3. Farmer or fisherman. If you report as a farmer or

not choose to stop the accrual of penalty on a prior

fisherman for federal purposes, you only have to make one

underpayment, you may carry the entire overpayment

installment for a taxable year.

The due date for this

forward to line 11 of the next period.

installment for a calendar year filer was January 15, 2002.

Part B - Underpayment of Estimated Tax

The due date for a fiscal year filer is the 15th day of the first

month after the end of the fiscal year. You do not have to

Penalty

make this payment if you file your Arizona return on or

Compute the penalty by applying the applicable rate to each

before March 1, 2002, and pay in full the amount stated on

underpayment. Compute the penalty for the number of days

the return as payable. Fiscal year filers must file and pay on

that the underpayment remained unpaid.

or before the first day of the third month after the end of the

fiscal year.

The penalty is equal to the interest that would accrue on the

underpayment. The penalty cannot be more than 10 percent

4. Nonresident alien. If you are an individual who elects to

of the underpayment. Calculate this penalty like interest.

be treated as a nonresident alien on the federal income tax

The penalty rates are established at various times during the

return, you may make three estimated payments. The due

year. The rate for the first quarter of 2002 (January 1, 2002,

dates for these installments were June 15, 2001, September

through March 31, 2002) was not established by the time the

17, 2001, and January 15, 2002. The first installment must

department printed this form. To get the interest rate that

have equaled 50 percent of the total required payments.

applies from January 1, 2002, to April 15, 2002, call one of

Line 10 - Estimated Tax Paid and Withheld

the help numbers listed on page 1 of these instructions.

Enter the estimated tax payments you made plus any Arizona

NOTE: If you have not paid the underpayment by December

income tax withheld for that quarter.

31, 2001, the outstanding penalty that relates to that

underpayment will compound on January 1, 2002.

In column (a), enter the tax payments you made by April 16,

2001, that were for the 2001 tax year. In column (b), enter

Use lines 14 through 27 to compute the penalty for each rate

payments you made after April 16 through June 15, 2001. In

period.

column (c), enter payments you made after June 15, 2001,

List your payments to figure the penalty applicable to these

through September 17, 2001. In column (d), enter payments

installments.

you made after September 17, 2001, through January 15, 2002.

TABLE 1

When figuring your payment dates and the amounts to enter

Payments after 4/16/01 through 6/30/01

on line 10 of each column, apply the following rules.

(a)

(b)

Date

Payments

Include ¼ of your Arizona income tax withheld in each

column. The department considers you to have paid ¼

of Arizona income tax withheld on each payment due

date unless you can show otherwise.

Include

your

estimated

tax

payments

any

TABLE 2

overpayment of tax from your 2000 return that you

Payments after 6/30/01 through 9/30/01

elected to apply to your 2001 estimated tax. You should

(a)

(b)

report this amount in column (a).

Date

Payments

If you file your return and pay the tax due by January

31, 2002, include on line 10, column (d), the amount of

tax you pay with your return. In this case, you will not

owe a penalty for the payment due by January 15, 2002.

NOTE: If line 10 equals or is more than line 9 in all columns,

TABLE 3

you do not owe a penalty. Do not complete the rest of this form.

Payments after 9/30/01 through 12/31/01

You must attach a copy of this form to your return.

(a)

(b)

Date

Payments

Lines 11 through 13 - Overpayments or

Underpayments

Complete lines 11 through 13 for one payment period before

you go to the next period.

Instructions For Arizona Form 221 - Underpayment Of Estimated Tax By Individuals - 2001 Page 3

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