BarBRanch has had taxable income of $450,000, $570,000, $760,000 and $680,000 in years 2016 through 2019, respectively.What were the equal minimum quarterly estimated tax payments for 2019 that BarBRanch should have made in 2019 to avoid any penalty?

Question

Quizplus · Accepted Answer

The equal minimum quarterly estimated tax payments for 2019 that BarBRanch should have made in 2019 to avoid any penalty is $35,576. This is because the required annual estimated tax payment is 90% of the current year's tax liability or 100% of the prior year's tax liability, whichever is smaller. The prior year's tax liability is $680,000, so the required annual estimated tax payment is $680,000 x 100% = $680,000. The equal minimum quarterly estimated tax payments are $680,000 / 4 = $35,576.

BarBRanch Has Had Taxable Income of $450,000, $570,000, $760,000 and $680,000