A taxpayer with an AGI of $157,350 for 2015 pays estimated taxes. The taxpayer can avoid an underpayment penalty by paying:

Question

Quizplus · Accepted Answer

The taxpayer can avoid an underpayment penalty by paying at least 90% of the 2015 tax liability ratably over four quarterly payments. This is the safe harbor rule. Option B would require paying more than the actual tax liability, which is not necessary to avoid penalties. Option C is only applicable in certain situations, such as when the taxpayer's AGI is over $150,000. Option D is not applicable to this taxpayer as their AGI in 2014 was not less than $100,000.

A Taxpayer with an AGI of $157,350 for 2015 Pays