DRS: 12-722(b)-1, Underpayments of estimated tax. Additions to tax - Repealed Effective 1/1/04

DRS has reproduced this regulation. This is an unofficial copy. Official copies of regulations ONLY are available from the Commission on Official Legal Publications. 111 Phoenix Avenue. Enfield, CT 06082. colp@jud.state.ct.us Copies of DRS forms and publications are available at http://www.ct.gov/drs

Repealed Effective 1/1/04

12-722(b)-1. Underpayments of estimated tax. Additions to tax

(a) On any required installment of estimated tax not paid in the amount specified in this Part, or not paid on or before the applicable due date specified in this Part, there shall be added to the tax an amount determined by applying interest at the rate of 1.25% per month or fraction thereof on the portion of such required installment not paid by the due date of that installment for the period of the underpayment. The period of the underpayment shall run from the due date for the installment to whichever of the following dates is earlier: the fifteenth day of the fourth month of the next succeeding taxable year or, with respect to any portion of the underpayment, the date on which such portion is paid. The addition to tax, if not paid by the fifteenth day of the fourth month of the next succeeding taxable year, shall not be subject to interest or penalty. Any payments of estimated tax received after the due date of an installment of which a portion has not been timely paid shall be applied first to such past due installment amount, and next to any currently due installment amount.

Example 1: Bís first estimated tax installment of $100 is due on or before April 15, and the second is due on or before June 15. B does not make an estimated tax payment until September 15, the due date of the third installment, at which time $300 is paid. As of September 15, the addition to tax is $6.25 on the unpaid portion of the first installment ($100) for five months, plus $3.75 on the unpaid portion of the second installment ($100) for three months, for a total of $10.

Example 2. Cís first estimated tax installment of $1000 is due on or before April 15. C pays $700 on April 15, and $1000 each on June 15 and September 15. C is now filing the fourth installment on January 15. The addition to tax on the first installment is $7.50 for the two months (from April 16 through June 15) during which the $300 underpayment of the first installment was unpaid, since on June 15 the $1000 payment went first to pay the past due unpaid amount and the remaining $700 went to pay the currently due installment, leaving the June 15 installment underpaid by $300. The addition to tax on the second installment is $11.25 for the three months (from June 16 through September 15) during which the June installment was underpaid. The September 15 installment went first to pay the unpaid portion of the June installment, leaving the September installment underpaid by $300. The addition to tax on the third installment is $15 for the four months (from September 16 through January 15) during which the September installment was underpaid. To become current on installments, C shall pay $1300 on January 15, and shall owe an addition to tax of $33.75 as of that date.

(b) While this section pertains to Section 12-722(b) of the general statutes, for purposes of supplementary interpretation, as the phrase is used in Section 12-2 of the general statutes, the adoption of this section is authorized by Section 12-740(a) of the general statutes.

(Effective 11/18/1994)